I.R.C. § 1058(a) General Rule
In the case of a taxpayer who transfers securities
(as defined in section 1236(c))
pursuant to an agreement which meets the requirements of subsection
(b), no gain or loss shall be recognized on the exchange of such securities by the
taxpayer for an obligation under such agreement, or on the exchange of rights under
such agreement by that taxpayer for securities identical to the securities transferred
by that taxpayer.
I.R.C. § 1058(b) Agreement Requirements
In order to meet the requirements of this subsection, an agreement shall—
I.R.C. § 1058(b)(1)
provide for the return to the transferor of securities identical to the securities
I.R.C. § 1058(b)(2)
require that payments shall be made to the transferor of amounts equivalent to all
interest, dividends, and other distributions which the owner of the securities is
entitled to receive during the period beginning with the transfer of the securities
by the transferor and ending with the transfer of identical securities back to the
I.R.C. § 1058(b)(3)
not reduce the risk of loss or opportunity for gain of the transferor of the securities
in the securities transferred;
I.R.C. § 1058(b)(4)
meet such other requirements as the Secretary may by regulation prescribe.
I.R.C. § 1058(c) Basis
Property acquired by a taxpayer described in subsection
(a), in a transaction described in that subsection, shall have the same basis as
the property transferred by that taxpayer.
(Added Pub. L. 95-345, 2(d)(1), Aug. 15, 1978, 92 Stat. 482.)
Section applicable with respect to amounts received after Dec. 31, 1976, as payments
with respect to securities loans
(as defined in section 512(a)(5) of this title), and transfers of securities, under
agreements described in this section, occurring after such date, see section 2(e)
of Pub. L. 95-345, set out as an Effective Date of 1978 Amendment note under section 509 of this title.
A prior section 1058 was renumbered section 1061 of this title.