26 U.S.C. § 1011 — Adjusted basis for determining gain or

Page 2251 TITLE 26—INTERNAL REVENUE CODE § 1012 retary or his delegate may by regulations prescribe), apply to transfers before January 1, 1970, but only with respect to payments made in taxable years ending after December 31, 1969, and beginning before January 1, 1980.’’ REPEALS Pub. L. 95–600, § 702(c)(9), cited as a credit to this sec- tion, and the amendment made thereby, were repealed by Pub. L. 96–223, title IV, § 401(a), 94 Stat. 299, resulting in the text of this section reading as it read prior to en- actment of section 702(c)(9). See Effective Date of 1980 Amendment and Revival of Prior Law note set out above. [§ 1002. Repealed. Pub. L. 94–455, title XIX, § 1901(b)(28)(B)(i), Oct. 4, 1976, 90 Stat. 1799] Section, act Aug. 16, 1954, ch. 736, 68A Stat. 295, re- lated to the recognition of the entire amount of gain or loss determined under section 1001 on the sale or ex- change of property. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94–455, set out as an Effective Date of 1976 Amendment note under section 2 of this title. PART II—BASIS RULES OF GENERAL APPLICATION Sec. 1011. Adjusted basis for determining gain or loss. 1012. Basis of property—cost. 1013. Basis of property included in inventory. 1014. Basis of property acquired from a decedent. 1015. Basis of property acquired by gifts and trans- fers in trust. 1016. Adjustments to basis. 1017. Discharge of indebtedness. [1018. Repealed.] 1019. Property on which lessee has made improve- ments. [1020. Repealed.] 1021. Sale of annuities. [1022. Repealed.] 1023. Cross references. [1024. Renumbered.] Editorial Notes AMENDMENTS 2010—Pub. L. 111–312, title III, § 301(a), Dec. 17, 2010, 124 Stat. 3300, amended analysis to read as if amend- ment by Pub. L. 107–16, § 542(e)(6), had never been en- acted. See 2001 Amendment note below. 2001—Pub. L. 107–16, title V, § 542(e)(6), June 7, 2001, 115 Stat. 86, added item 1022. 1980—Pub. L. 96–589, § 6(h)(2), Dec. 24, 1980, 94 Stat. 3410, struck out item 1018 ‘‘Adjustments of capital structure before September 22, 1938’’. Pub. L. 96–223, title IV, § 401(a), Apr. 2, 1980, 94 Stat. 299, repealed section 2005(e)(1) of Pub. L. 94–455 and the amendment made thereby. See 1986 Amendment note below. 1978—Pub. L. 95–600, title V, § 515(5), Nov. 6, 1978, 92 Stat. 2884, substituted ‘‘December 31, 1979’’ for ‘‘Decem- ber 31, 1976’’ in item 1023. 1976—Pub. L. 94–455, title XX, § 2005(e)(1), Oct. 4, 1976, 90 Stat. 1878, which added item 1023 and redesignated former item 1023 as 1024, was repealed by Pub. L. 96–223, § 401(a). See section 401(b), (e) of Pub. L. 96–223, set out as an Effective Date of 1980 Amendments and Revival of Prior Law note under section 1023 of this title. Pub. L. 94–455, title XIX, § 1901(b)(29)(B), (30)(C), Oct. 4, 1976, 90 Stat. 1799, struck out item 1020 ‘‘Election in respect of depreciation, etc., allowed before 1952’’, and item 1022 ‘‘Increase in basis with respect to certain for- eign personal holding company stock or securities’’. 1964—Pub. L. 88–272, title II, § 225(j)(3), Feb. 26, 1964, 78 Stat. 93, added item 1022 and redesignated former item 1022 as 1023. § 1011. Adjusted basis for determining gain or loss (a) General rule The adjusted basis for determining the gain or loss from the sale or other disposition of prop- erty, whenever acquired, shall be the basis (de- termined under section 1012 or other applicable sections of this subchapter and subchapters C (relating to corporate distributions and adjust- ments), K (relating to partners and partner- ships), and P (relating to capital gains and losses)), adjusted as provided in section 1016. (b) Bargain sale to a charitable organization If a deduction is allowable under section 170 (relating to charitable contributions) by reason of a sale, then the adjusted basis for deter- mining the gain from such sale shall be that portion of the adjusted basis which bears the same ratio to the adjusted basis as the amount realized bears to the fair market value of the property. (Aug. 16, 1954, ch. 736, 68A Stat. 296; Pub. L. 91–172, title II, § 201(f), Dec. 30, 1969, 83 Stat. 564.) Editorial Notes AMENDMENTS 1969—Pub. L. 91–172 redesignated existing provisions as subsec. (a) and added subsec. (b). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1969 AMENDMENT Amendment by Pub. L. 91–172 applicable with respect to sales made after Dec. 19, 1969, see section 201(g)(6) of Pub. L. 91–172, set out as a note under section 170 of this title. § 1012. Basis of property—cost (a) In general The basis of property shall be the cost of such property, except as otherwise provided in this subchapter and subchapters C (relating to cor- porate distributions and adjustments), K (relat- ing to partners and partnerships), and P (relat- ing to capital gains and losses). (b) Special rule for apportioned real estate taxes The cost of real property shall not include any amount in respect of real property taxes which are treated under section 164(d) as imposed on the taxpayer. (c) Determinations by account (1) In general In the case of the sale, exchange, or other disposition of a specified security on or after the applicable date, the conventions pre- scribed by regulations under this section shall be applied on an account by account basis. (2) Application to certain regulated investment companies (A) In general Except as provided in subparagraph (B), any stock for which an average basis method