Editor's Note:
Pub. L. 108-357, Sec. 886(b)(1)(A), repealed Sec. 1056, effective for property acquired after October 22, 2004.
I.R.C. § 1056(a) General Rule —
Editor's Note:
Pub. L. 108-357, Sec. 886(b)(1)(A), repealed Sec. 1056, effective for property acquired after October 22, 2004.
If a franchise to conduct any sports enterprise is sold or exchanged, and if, in
connection with such sale or exchange, there is a transfer of a contract for the
services of an athlete, the basis of such contract in the hands of the transferee
shall not exceed the sum of—
I.R.C. § 1056(a)(1) —
the adjusted basis of such contract in the hands of the transferor immediately before
the transfer, plus
I.R.C. § 1056(a)(2) —
the gain (if any) recognized by the transferor on the transfer of such contract.
I.R.C. § 1056(b) Exceptions —
Editor's Note:
Pub. L. 108-357, Sec. 886(b)(1)(A), repealed Sec. 1056, effective for property acquired after October 22, 2004.
Subsection (a) shall not apply—
I.R.C. § 1056(b)(1) —
to an exchange described in section 1031 (relating to exchange of property held for productive use or investment), and
I.R.C. § 1056(b)(2) —
to property in the hands of a person acquiring the property from a decedent or to
whom the property passed from a decedent (within the meaning of section 1014(a)).
I.R.C. § 1056(c) Transferor Required To Furnish Certain Information —
Editor's Note:
Pub. L. 108-357, Sec. 886(b)(1)(A), repealed Sec. 1056, effective for property acquired after October 22, 2004.
Under regulations prescribed by the Secretary, the transfer shall, at the times and
in the manner provided in such regulations, furnish to the Secretary and to the transferee
the following information:
I.R.C. § 1056(c)(1) —
the amount which the transferor believes to be the adjusted basis referred to in
paragraph (1) of subsection
(a),
I.R.C. § 1056(c)(2) —
the amount which the transferor believes to be the gain referred to in paragraph
(2) of subsection (a), and
I.R.C. § 1056(c)(3) —
any subsequent modification of either such amount.
To the extent provided in such regulations, the amounts
furnished pursuant to the preceding sentence shall be binding on the transferor and
on the transferee.
I.R.C. § 1056(d) Presumption As To Amount Allocable To Player Contracts —
Editor's Note:
Pub. L. 108-357, Sec. 886(b)(1)(A), repealed Sec. 1056, effective for property acquired after October 22, 2004.
In the case of any sale or exchange described in subsection (a), it shall be presumed
that not more than 50 percent of the consideration is allocable to contracts for
the services of athletes unless it is established to the satisfaction of the Secretary
that a specified amount in excess of 50 percent is properly allocable to such contracts.
Nothing in the preceding sentence shall give rise to a presumption that an allocation
of less than 50 percent of the consideration to contracts for the services of athletes
is a proper allocation.
(Added Pub. L. 94-455, title II, 212(a)(1), Oct. 4, 1976, 90 Stat. 1545, and amended Pub. L. 99-514, title VI, 631(e)(13), Oct. 22, 1986, 100 Stat. 2275; Repealed by Pub. L. 108-357, title VII, Sec. 886(b)(1)(A), Oct. 22, 2004, 118 Stat. 1418.)
BACKGROUND NOTES
AMENDMENTS
2004 - Sec. 1056. Pub. L. 108-357, Sec. 886(b)(1), repealed Sec. 1056.
1986--Subsec. (a). Pub. L. 99-514 struck out “For purposes of this section, gain realized by the transferor on the
transfer of such contract, but not recognized by reason of section 337(a), shall be
treated as recognized to the extent recognized by the transferor's shareholders.”
EFFECTIVE DATE OF REPEAL
Repeal of Section 1056 effective for property acquired after the date of the enactment
of this Act [Enacted: Oct. 22, 2004].
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by Pub. L. 99-514 applicable to any distribution in complete liquidation, and any sale or exchange,
made by a corporation after July 31, 1986, unless such corporation is completely liquidated
before Jan. 1, 1987, any transaction described in section 338 of this title for which
the acquisition date occurs after Dec. 31, 1986, and any distribution, not in complete
liquidation, made after Dec. 31, 1986, with exceptions and special and transitional
rules, see section 633 of Pub. L. 99-514, set out as an Effective Date note under section 336 of this title.
EFFECTIVE DATE
Section 212(a)(3) of Pub. L. 94-455 provided that: “The amendments made by this subsection
[enacting this section and renumbering former section 1056 as 1057]
apply to sales or exchanges of franchises after December 31, 1975, in taxable years
ending after such date.”
PRIOR PROVISIONS
A prior section 1056 was renumbered section 1061 of this title.
