26 U.S.C. § 1071 — Untitled legal text

Page 2302 TITLE 26—INTERNAL REVENUE CODE § 1062 2 So in original. Probably should be followed by a period. (ii) the value of such interest subject to tax under section 83 upon the receipt or vesting of such interest. (5) Third party investor The term ‘‘third party investor’’ means a person who— (A) holds an interest in the partnership which does not constitute property held in connection with an applicable trade or busi- ness; and (B) is not (and has not been) actively en- gaged, and is (and was) not related to a per- son so engaged, in (directly or indirectly) providing substantial services described in paragraph (1) for such partnership or any ap- plicable trade or business. (d) Transfer of applicable partnership interest to related person (1) In general If a taxpayer transfers any applicable part- nership interest, directly or indirectly, to a person related to the taxpayer, the taxpayer shall include in gross income (as short term capital gain) the excess (if any) of— (A) so much of the taxpayer’s long-term capital gains with respect to such interest for such taxable year attributable to the sale or exchange of any asset held for not more than 3 years as is allocable to such interest, over (B) any amount treated as short term cap- ital gain under subsection (a) with respect to the transfer of such interest. (2) Related person For purposes of this paragraph, a person is related to the taxpayer if— (A) the person is a member of the tax- payer’s family within the meaning of section 318(a)(1), or (B) the person performed a service within the current calendar year or the preceding three calendar years in any applicable trade or business in which or for which the tax- payer performed a service. (e) Reporting The Secretary shall require such reporting (at the time and in the manner prescribed by the Secretary) as is necessary to carry out the pur- poses of this section. (f) Regulations The Secretary shall issue such regulations or other guidance as is necessary or appropriate to carry out the purposes of this section 2 (Added Pub. L. 115–97, title I, § 13309(a)(2), Dec. 22, 2017, 131 Stat. 2130.) Editorial Notes PRIOR PROVISIONS A prior section 1061 was renumbered section 1062 of this title. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Pub. L. 115–97, title I, § 13309(c), Dec. 22, 2017, 131 Stat. 2131, provided that: ‘‘The amendments made by this section [enacting this section and renumbering former section 1061 of this title as section 1062] shall apply to taxable years beginning after December 31, 2017.’’ § 1062. Cross references (1) For nonrecognition of gain in connection with the transfer of obsolete vessels to the Maritime Ad- ministration under chapter 573 of title 46, United States Code, see section 57307 of title 46. (2) For recognition of gain or loss in connection with the construction of new vessels, see chapter 533 of title 46, United States Code. (Aug. 16, 1954, ch. 736, 68A Stat. 311, § 1054; re- numbered § 1055, Pub. L. 86–779, § 8(b), Sept. 14, 1960, 74 Stat. 1003; renumbered § 1056, Pub. L. 88–9, § 1(b), Apr. 10, 1963, 77 Stat. 7; renumbered § 1057, Pub. L. 94–455, title II, § 212(a)(1), Oct. 4, 1976, 90 Stat. 1545; renumbered § 1058, Pub. L. 94–455, title X, § 1015(c), Oct. 4, 1976, 90 Stat. 1618; renumbered § 1059, Pub. L. 95–345, § 2(d)(1), Aug. 15, 1978, 92 Stat. 482; renumbered § 1060, Pub. L. 98–369, div. A, title I, § 53(a), July 18, 1984, 98 Stat. 565; renumbered § 1061 and amended, Pub. L. 99–514, title VI, § 641(a), title XVIII, § 1899A(27), Oct. 22, 1986, 100 Stat. 2282, 2960; Pub. L. 109–304, § 17(e)(5), Oct. 6, 2006, 120 Stat. 1708; renumbered § 1062, Pub. L. 115–97, title I, § 13309(a)(1), Dec. 22, 2017, 131 Stat. 2130.) Editorial Notes AMENDMENTS 2017—Pub. L. 115–97 renumbered section 1061 of this title as this section. 2006—Par. (1). Pub. L. 109–304, § 17(e)(5)(A), substituted ‘‘chapter 573 of title 46, United States Code, see section 57307 of title 46’’ for ‘‘section 510 of the Merchant Ma- rine Act, 1936, see subsection (e) of that section, as amended August 4, 1939 (46 U.S.C. App. 1160)’’. Par. (2). Pub. L. 109–304, § 17(e)(5)(B), substituted ‘‘chapter 533 of title 46, United States Code’’ for ‘‘sec- tion 511 of such Act, as amended (46 U.S.C. App. 1161)’’. Par. (3). Pub. L. 109–304, § 17(e)(5)(C), struck out par. (3), which read as follows: ‘‘For nonrecognition of gain in connection with vessels exchanged with the Mari- time Administration under section 8 of the Merchant Ship Sales Act of 1946, see subsection (a) of that section (50 U.S.C. App. 1741).’’ 1986—Pub. L. 99–514, § 641(a), renumbered section 1060 of this title as this section. Pars. (1), (2). Pub. L. 99–514, § 1899A(27), which directed the amendment of pars. (1) and (2) of section 1060 by substituting ‘‘46 U.S.C. App.’’ for ‘‘46 U.S.C.’’ was exe- cuted to section 1061 to reflect the probable intent of Congress in view of the renumbering of section 1060 as 1061 by section 641(a) of Pub. L. 99–514. [PART V—REPEALED] [§ 1071. Repealed. Pub. L. 104–7, § 2(a), Apr. 11, 1995, 109 Stat. 93] Section, acts Aug. 16, 1954, ch. 736, 68A Stat. 311; Sept. 2, 1958, Pub. L. 85–866, title I, § 48(a), 72 Stat. 1642; Oct. 4, 1976, Pub. L. 94–455, title XIX, §§ 1901(b)(31)(E), 1906(b)(13)(A), 90 Stat. 1800, 1834, provided for non- recognition on FCC certified sales and exchanges. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Pub. L. 104–7, § 2(d), Apr. 11, 1995, 109 Stat. 93, provided that: ‘‘(1) IN GENERAL.—The amendments made by this sec- tion [repealing this section and amending sections 1245 and 1250 of this title] shall apply to— Page 2303 TITLE 26—INTERNAL REVENUE CODE § 1091 ‘‘(A) sales and exchanges on or after January 17, 1995, and ‘‘(B) sales and exchanges before such date if the FCC tax certificate with respect to such sale or ex- change is issued on or after such date. ‘‘(2) BINDING CONTRACTS.— ‘‘(A) IN GENERAL.—The amendments made by this section shall not apply to any sale or exchange pursu- ant to a written contract which was binding on Janu- ary 16, 1995, and at all times thereafter before the sale or exchange, if the FCC tax certificate with respect to such sale or exchange was applied for, or issued, on or before such date. ‘‘(B) SALES CONTINGENT ON ISSUANCE OF CERTIFI- CATE.— ‘‘(i) IN GENERAL.—A contract shall be treated as not binding for purposes of subparagraph (A) if the sale or exchange pursuant to such contract, or the material terms of such contract, were contingent, at any time on January 16, 1995, on the issuance of an FCC tax certificate. The preceding sentence shall not apply if the FCC tax certificate for such sale or exchange is issued on or before January 16, 1995. ‘‘(ii) MATERIAL TERMS.—For purposes of clause (i), the material terms of a contract shall not be treat- ed as contingent on the issuance of an FCC tax cer- tificate solely because such terms provide that the sales price would, if such certificate were not issued, be increased by an amount not greater than 10 percent of the sales price otherwise provided in the contract. ‘‘(3) FCC TAX CERTIFICATE.—For purposes of this sub- section, the term ‘FCC tax certificate’ means any cer- tificate of the Federal Communications Commission for the effectuation of section 1071 of the Internal Revenue Code of 1986 (as in effect on the day before the date of the enactment of this Act [Apr. 11, 1995]).’’ [PART VI—REPEALED] [§§ 1081 to 1083. Repealed. Pub. L. 109–135, title IV, § 402(a)(1), Dec. 21, 2005, 119 Stat. 2610] Section 1081, acts Aug. 16, 1954, ch. 736, 68A Stat. 312; Pub. L. 94–455, title XIX, §§ 1901(a)(132), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1786, 1834, provided for nonrecogni- tion of gain or loss on exchanges or distributions in obedience to orders of SEC. Section 1082, acts Aug. 16, 1954, ch. 736, 68A Stat. 315; Pub. L. 91–172, title VII, § 704(b)(3), Dec. 30, 1969, 83 Stat. 669; Pub. L. 92–178, title III, § 303(c)(5), Dec. 10, 1971, 85 Stat. 522; Pub. L. 94–455, title XIX, §§ 1901(b)(11)(C), 1906(b)(13)(A), 1951(c)(2)(B), title XXI, § 2124(a)(3)(C), Oct. 4, 1976, 90 Stat. 1795, 1834, 1840, 1917; Pub. L. 97–34, title II, § 212(d)(2)(E), Aug. 13, 1981, 95 Stat. 239; Pub. L. 99–514, title II, § 242(b)(1), Oct. 22, 1986, 100 Stat. 2181; Pub. L. 101–508, title XI, § 11801(c)(6)(D), Nov. 5, 1990, 104 Stat. 1388–524, related to basis for determining gain or loss. Section 1083, acts Aug. 16, 1954, ch. 736, 68A Stat. 317; Pub. L. 94–455, title XIX, § 1901(a)(133), Oct. 4, 1976, 90 Stat. 1786, related to definitions for this part. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective as if included in the provisions of the Energy Policy Act of 2005, Pub. L. 109–58, to which it re- lates, but not applicable with respect to any trans- action ordered in compliance with the Public Utility Holding Company Act of 1935 (15 U.S.C. 79 et seq.) be- fore that Act’s repeal, see section 402(m) of Pub. L. 109–135, set out as an Effective and Termination Dates of 2005 Amendments note under section 23 of this title. PART VII—WASH SALES; STRADDLES Sec. 1091. Loss from wash sales of stock or securities. Sec. 1092. Straddles. Editorial Notes AMENDMENTS 1981—Pub. L. 97–34, title V, § 501(d)(1), (2), Aug. 13, 1981, 95 Stat. 326, 327, substituted as part heading ‘‘WASH SALES; STRADDLES’’ for ‘‘WASH SALES OF STOCK OR SECURITIES’’ and added item 1092. § 1091. Loss from wash sales of stock or securities (a) Disallowance of loss deduction In the case of any loss claimed to have been sustained from any sale or other disposition of shares of stock or securities where it appears that, within a period beginning 30 days before the date of such sale or disposition and ending 30 days after such date, the taxpayer has acquired (by purchase or by an exchange on which the en- tire amount of gain or loss was recognized by law), or has entered into a contract or option so to acquire, substantially identical stock or secu- rities, then no deduction shall be allowed under section 165 unless the taxpayer is a dealer in stock or securities and the loss is sustained in a transaction made in the ordinary course of such business. For purposes of this section, the term ‘‘stock or securities’’ shall, except as provided in regulations, include contracts or options to ac- quire or sell stock or securities. (b) Stock acquired less than stock sold If the amount of stock or securities acquired (or covered by the contract or option to acquire) is less than the amount of stock or securities sold or otherwise disposed of, then the par- ticular shares of stock or securities the loss from the sale or other disposition of which is not deductible shall be determined under regula- tions prescribed by the Secretary. (c) Stock acquired not less than stock sold If the amount of stock or securities acquired (or covered by the contract or option to acquire) is not less than the amount of stock or securi- ties sold or otherwise disposed of, then the par- ticular shares of stock or securities the acquisi- tion of which (or the contract or option to ac- quire which) resulted in the nondeductibility of the loss shall be determined under regulations prescribed by the Secretary. (d) Unadjusted basis in case of wash sale of stock If the property consists of stock or securities the acquisition of which (or the contract or op- tion to acquire which) resulted in the non- deductibility (under this section or cor- responding provisions of prior internal revenue laws) of the loss from the sale or other disposi- tion of substantially identical stock or securi- ties, then the basis shall be the basis of the stock or securities so sold or disposed of, in- creased or decreased, as the case may be, by the difference, if any, between the price at which the property was acquired and the price at which such substantially identical stock or se- curities were sold or otherwise disposed of. (e) Certain short sales of stock or securities and securities futures contracts to sell Rules similar to the rules of subsection (a) shall apply to any loss realized on the closing of