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Internal Revenue Code, § 1245. Gain From Dispositions Of Certain Depreciable Property

I.R.C. § 1245(a) General Rule
I.R.C. § 1245(a)(1) Ordinary Income
Except as otherwise provided in this section, if section 1245 property is disposed of the amount by which the lower of—
I.R.C. § 1245(a)(1)(A)
the recomputed basis of the property, or
I.R.C. § 1245(a)(1)(B)
I.R.C. § 1245(a)(1)(B)(i)
in the case of a sale, exchange, or involuntary conversion, the amount realized, or
I.R.C. § 1245(a)(1)(B)(ii)
in the case of any other disposition, the fair market value of such property,
exceeds the adjusted basis of such property shall be treated as ordinary income. Such gain shall be recognized notwithstanding any other provision of this subtitle.
I.R.C. § 1245(a)(2) Recomputed Basis
For purposes of this section—
I.R.C. § 1245(a)(2)(A) In General
The term “recomputed basis” means, with respect to any property, its adjusted basis recomputed by adding thereto all adjustments reflected in such adjusted basis on account of deductions (whether in respect of the same or other property) allowed or allowable to the taxpayer or to any other person for depreciation or amortization.
I.R.C. § 1245(a)(2)(B) Taxpayer May Establish Amount Allowed
For purposes of subparagraph (A), if the taxpayer can establish by adequate records or other sufficient evidence that the amount allowed for depreciation or amortization for any period was less than the amount allowable, the amount added for such period shall be the amount allowed.
I.R.C. § 1245(a)(2)(C) Certain Deductions Treated As Amortization
Any deduction allowable under section 179, 179B, 179C, 179D, 179E, 181, 190, 193, 1 or 194 shall be treated as if it were a deduction allowable for amortization.
1 Amendments:Section 13261(f)(4) of the Revenue Reconciliation Act of 1993 amended subparagraph (C) of section 1245(a)(2) by striking “193, or 1253(d)(2) or (3)” and inserting “or 193”.
I.R.C. § 1245(a)(3) Section 1245 Property
For purposes of this section, the term “section 1245 property” means any property which is or has been property of a character subject to the allowance for depreciation provided in section 167 and is either—
I.R.C. § 1245(a)(3)(A)
personal property,
I.R.C. § 1245(a)(3)(B)
other property (not including a building or its structural components) but only if such other property is tangible and has an adjusted basis in which there are reflected adjustments described in paragraph (2) for a period in which such property (or other property)—
I.R.C. § 1245(a)(3)(B)(i)
was used as an integral part of manufacturing, production, or extraction or of furnishing transportation, communications, electrical energy, gas, water, or sewage disposal services,
I.R.C. § 1245(a)(3)(B)(ii)
constituted a research facility used in connection with any of the activities referred to in clause (i), or
I.R.C. § 1245(a)(3)(B)(iii)
constituted a facility used in connection with any of the activities referred to in clause (i) for the bulk storage of fungible commodities (including commodities in a liquid or gaseous state),
I.R.C. § 1245(a)(3)(C)
so much of any real property (other than any property described in subparagraph (B)) which has an adjusted basis in which there are reflected adjustments for amortization under section 169, 179, 179B, 179C, 179D, 179E, 188 (as in effect before its repeal by the Revenue Reconciliation Act of 1990), 190, 193, or 194[,]
I.R.C. § 1245(a)(3)(D)
a single purpose agricultural or horticultural structure (as defined in section 168(i)(13)),
I.R.C. § 1245(a)(3)(E)
a storage facility (not including a building or its structural components) used in connection with the distribution of petroleum or any primary product of petroleum, or
I.R.C. § 1245(a)(3)(F)
any railroad grading or tunnel bore (as defined in section 168(e)(4)).
I.R.C. § 1245(b) Exceptions And Limitations
I.R.C. § 1245(b)(1) Gifts
Subsection (a) shall not apply to a disposition by gift.
I.R.C. § 1245(b)(2) Transfers At Death
Except as provided in section 691 (relating to income in respect of a decedent), subsection (a) shall not apply to a transfer at death.
I.R.C. § 1245(b)(3) Certain Tax-Free Transactions
If the basis of property in the hands of a transferee is determined by reference to its basis in the hands of the transferor by reason of the application of section 332, 351, 361, 721, or 731, then the amount of gain taken into account by the transferor under subsection (a)(1) shall not exceed the amount of gain recognized to the transferor on the transfer of such property (determined without regard to this section). Except as provided in paragraph (6), this paragraph shall not apply to a disposition to an organization (other than a cooperative described in section 521) which is exempt from the tax imposed by this chapter.
I.R.C. § 1245(b)(4) Like Kind Exchanges; Involuntary Conversions, Etc.
If property is disposed of and gain (determined without regard to this section) is not recognized in whole or in part under section 1031 or 1033, then the amount of gain taken into account by the transferor under subsection (a)(1) shall not exceed the sum of--
I.R.C. § 1245(b)(4)(A)
the amount of gain recognized on such disposition (determined without regard to this section), plus
I.R.C. § 1245(b)(4)(B)
the fair market value of property acquired which is not section 1245 property and which is not taken into account under subparagraph (A).
I.R.C. § 1245(b)(5) Property Distributed By A Partnership To A Partner
I.R.C. § 1245(b)(5)(A) In General
For purposes of this section, the basis of section 1245 property distributed by a partnership to a partner shall be deemed to be determined by reference to the adjusted basis of such property to the partnership.
I.R.C. § 1245(b)(5)(B) Adjustments Added Back
In the case of any property described in subparagraph (A), for purposes of computing the recomputed basis of such property the amount of the adjustments added back for periods before the distribution by the partnership shall be—
I.R.C. § 1245(b)(5)(B)(i)
the amount of the gain to which subsection (a) would have applied if such property had been sold by the partnership immediately before the distribution at its fair market value at such time, reduced by
I.R.C. § 1245(b)(5)(B)(ii)
the amount of such gain to which section 751(b) applied.
I.R.C. § 1245(b)(6) Transfers To Tax-Exempt Organization Where Property Will Be Used In Unrelated Business
I.R.C. § 1245(b)(6)(A) In General
The second sentence of paragraph (3) shall not apply to a disposition of section 1245 property to an organization described in section 511(a)(2) or 511(b)(2) if, immediately after such disposition, such organization uses such property in an unrelated trade or business (as defined in section 513).
I.R.C. § 1245(b)(6)(B) Later Change In Use
If any property with respect to the disposition of which gain is not recognized by reason of subparagraph (A) ceases to be used in an unrelated trade or business of the organization acquiring such property, such organization shall be treated for purposes of this section as having disposed of such property on the date of such cessation.
I.R.C. § 1245(b)(7) Timber Property
In determining, under subsection (a)(2), the recomputed basis of property with respect to which a deduction under section 194 was allowed for any taxable year, the taxpayer shall not take into account adjustments under section 194 to the extent such adjustments are attributable to the amortizable basis of the taxpayer acquired before the 10th taxable year preceding the taxable year in which gain with respect to the property is recognized.
I.R.C. § 1245(b)(8) Disposition Of Amortizable Section 197 Intangibles
I.R.C. § 1245(b)(8)(A) In General
If a taxpayer disposes of more than 1 amortizable section 197 intangible (as defined in section 197(c)) in a transaction or a series of related transactions, all such amortizable 197 intangibles shall be treated as 1 section 1245 property for purposes of this section.
I.R.C. § 1245(b)(8)(B) Exception
Subparagraph (A) shall not apply to any amortizable section 197 intangible (as so defined) with respect to which the adjusted basis exceeds the fair market value.
I.R.C. § 1245(c) Adjustments To Basis
The Secretary shall prescribe such regulations as he may deem necessary to provide for adjustments to the basis of property to reflect gain recognized under subsection (a).
I.R.C. § 1245(d) Application Of Section
This section shall apply notwithstanding any other provision of this subtitle.
(Added by Pub. L. 87-834, Sec. 13(a)(1), Oct. 16, 1962, 76 Stat. 1032, and amended by Pub. L. 88-272, title II, Sec. 203(d), Feb. 26, 1964, 78 Stat. 35; Pub. L. 91-172, title II, Sec. 212(a)(1), (2), title VII, Sec. 704(b)(4), Dec. 30, 1969, 83 Stat. 571, 670; Pub. L. 92-178, title I, Sec. 104(a)(2), title III, Sec. 303(c)(1), (2), Dec. 10, 1971, 85 Stat. 501, 522; Pub. L. 94-81, Sec. 2(a), Aug. 9, 1975, 89 Stat. 417; Pub. L. 94-455, title II, Sec. 212(b)(1), title XIX, Sec. 1901(a)(140), (b)(3)(K), (11)(D), 1906(b) (13)(A), 1951(c)(2)(C), title XXI, Sec. 2122(b)(3), 2124(a)(2), Oct. 4, 1976, 90 Stat. 1546, 1787, 1793, 1795, 1834, 1840, 1915, 1917; Pub. L. 95-600, title VII, Sec. 701(f)(3)(A), (B), (w)(1), (2), Nov. 6, 1978, 92 Stat. 2901, 2920; Pub. L. 96-223, title II, Sec. 251(a)(2)(C), Apr. 2, 1980, 94 Stat. 287; Pub. L. 96-451, title III, Sec. 301(c)(1), Oct. 14, 1980, 94 Stat. 1990; Pub. L. 97-34, title II, Sec. 201(b), 202(b), 204(a)-(d), 212(d)(2)(F), Aug. 13, 1981, 95 Stat. 218, 220, 222, 223, 239; Pub. L. 97-448, title I, Sec. 102(e)(2)(B), Jan. 12, 1983, 96 Stat. 2371; Pub. L. 98-369, div. A, title I, Sec. 111(e)(5), (10), July 18, 1984, 98 Stat. 633; Pub. L. 99-121, title I, Sec. 103(b)(1)(D), Oct. 11, 1985, 99 Stat. 509; Pub. L. 99-514, title II, Sec. 201(d)(11), Oct. 22, 1986, 100 Stat. 2141; Pub. L. 100-647, title I, Sec. 1002(i)(2)(I), Nov. 10, 1988, 102 Stat. 3371; Pub. L. 101-239, title VII, Sec. 7622(b)(2)((d)(2)), Dec. 19, 1989, 103 Stat. 2378; Pub. L. 101-508, title XI, Sec. 11704(a)(13), 11801(c)(6)(E), (8)(H), 11813(b)(21), Nov. 5, 1990, 104 Stat. 1388-518, 1388-524, 1388-555; Pub. L. 103-66, title XIII, Sec. 13261(f), Aug. 10, 1993, 107 Stat. 312; Apr. 11, 1995, Pub. L. 104-7, Sec. 2(b); Aug. 20, 1996, Pub. L. 104-188, Sec. 1703(n)(6), 110 Stat. 1755; Pub. L. 105-34, title XVI, Sec. 1604(a)(3), Aug. 5, 1997, 111 Stat 788; Oct. 22, 2004, Pub. L. 108-357, title III, VIII, Sec. 338(b)(5), 886(b)(2), 118 Stat. 1418; Pub. L. 109-58, title XIII, Sec. 1323(b)(1), 1331(b)(2), 1363(a), Aug. 8, 2005, 119 Stat. 594; Pub. L. 109-135, title IV, Sec. 402(a)(6), 403(e)(2), 403(i)(2), Dec. 21, 2005, 119 Stat. 2577; Pub. L. 109-432, div. A, title IV, Sec. 404(b)(3), Dec. 20, 2006, 120 Stat. 2922; Pub. L. 113-295, Div. A, title II, Sec. 221(a)(34)(H), Dec. 19, 2014, 128 Stat. 4010; Pub. L. 115-141, Div. U, title IV, Sec. 401(a)(31), Mar. 23, 2018, 132 Stat. 348.)
BACKGROUND NOTES
AMENDMENTS
2018 - Subsec. (a)(3)(C). Pub. L. 115-141, Div. U, Sec. 401(b)(31), amended subpar. (C) by striking “, 185”.
2014 - Subsec. (a)(2)(C). Pub. L. 113-295, Div. A, Sec. 221(a)(34)(H), amended subpar. (C) by striking “179A,”.
Subsec. (a)(3)(C). Pub. L. 113-295, Div. A, Sec. 221(a)(34)(H), amended subpar. (C) by striking “179A,”.
2006 - Subsec. (a)(2)(C). Pub. L. 109-432, Sec. 404(b)(3), amended subpar. (C) by inserting “179E,” after “179D,”.
Subsec. (a)(3)(C). Pub. L. 109-432, Sec. 404(b)(3), amended subpar. (C) by inserting “179E,” after “179D”.
2005 - Subsec. (a)(2)(C). Pub. L. 109-135, Sec. 403(e)(2), amended subpar. (C) by inserting “181,” after “179B,”.
Subsec. (a)(2)(C). Pub. L. 109-135, Sec. 403(i)(2), amended subpar. (C) by substituting “193, or 194” for “or 193”.
Subsec. (b)(3). Pub. L. 109-135, Sec. 402(a)(6)(B), amended par. (3) by substituting “paragraph (6)” for “paragraph (7)”.
Subsec. (b)(5)-(9). Pub. L. 109-135, Sec. 402(a)(6)(A), struck par. (5) and redesignated par. (6)-(9) as par. (5)-(8), respectively. Before being struck, par. (5) read as follows:
“(5) Section 1081 transactions
“Under regulations prescribed by the Secretary, rules consistent with paragraphs (3) and (4) of this subsection shall apply in the case of transactions described in section 1081 (relating to exchanges in obedience to SEC orders).”
Subsec. (a)(2)(C). Pub. L. 109-58, Sec. 1323(b)(1), amended subpar. (C) by inserting “179C,” after “179B,”.
Subsec. (a)(2)(C). Pub. L. 109-58, Sec. 1323(b)(2), amended subpar. (C) by inserting “179D,” after “179C,”.
Subsec. (a)(3)(C). Pub. L. 109-58, Sec. 1323(b)(1), amended subpar. (C) by inserting “179C,” after “179B,”.
Subsec. (a)(3)(C). Pub. L. 109-58, Sec. 1323(b)(2), amended subpar. (C) by inserting “179D,” after “179C,”.
Subsec. (b)(9). Pub. L. 109-58, Sec. 1363(a), added par. (9).
2004 - Subsec. (a)(2)(C). Pub. L. 108-357, Sec. 338(b)(5), amended subpar. (C) by inserting “179B,” after “179A,”.
Subsec. (a)(3)(C). Pub. L. 108-357, Sec. 338(b)(5), amended subpar. (C) by inserting “179B,” after “179A,”.
Subsec. (a)(4). Pub. L. 108-357, Sec. 886(b)(2), struck par. (4). Before being struck, it read as follows:
“(4) Special rule for player contracts
“(A) In general
“For purposes of this section, 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 any player contracts, the recomputed basis of such player contracts in the hands of the transferor shall be the adjusted basis of such contracts increased by the greater of--
“(i) the previously unrecaptured depreciation with respect to player contracts acquired by the transferor at the time of acquisition of such franchise, or
“(ii) the previously unrecaptured depreciation with respect to the player contracts involved in such transfer.
“(B) Previously unrecaptured depreciation with respect to initial contracts
“For purposes of subparagraph (A)(i), the term “previously unrecaptured depreciation” means the excess (if any) of--
“(i) the sum of the deduction allowed or allowable to the taxpayer transferor for the depreciation attributable to periods after December 31, 1975, of any player contracts acquired by him at the time of acquisition of such franchise, plus the deduction allowed or allowable for losses incurred after December 31, 1975, with respect to such player contracts acquired at the time of such acquisition, over
“(ii) the aggregate of the amounts described in clause (i) treated as ordinary income by reason of this section with respect to prior dispositions of such player contracts acquired upon acquisition of the franchise.
“(C) Previously unrecaptured depreciation with respect to contracts transferred
“For purposes of subparagraph (A)(ii), the term “previously unrecaptured depreciation” means the amount of any deduction allowed or allowable to the taxpayer transferor for the depreciation of any contracts involved in such transfer.
“(D) Player contract
“For purposes of this paragraph, the term “player contract” means any contract for the services of an athlete which, in the hands of the taxpayer, is of a character subject to the allowance for depreciation provided in section 167.”
1997 - Subsec. (a)(2)(C). Pub. L. 105-34, Sec. 1604(a)(3) inserted “179A,” after “179,”.
Subsec. (a)(3)(C). Pub. L. 105-34, Sec. 1604(a)(3) inserted “179A,” after “179,”.
1995 - Subsec. (b)(5). Pub. L. 104-7, Sec. 2(b), amended (b)(5) by striking “section 1071 (relating to gain from sale or exchange to effectuate policies of FCC) or” from the text and “1071 and” from the heading.
1993 - Subsec. (a)(2)(C). Pub. L. 103-66, Sec. 13261(f)(4), amended subpar. (C) by substituting “or 193” for “193, or 1253(d)(2) or (3)”.
Subsec. (a)(3). Pub. L. 103-66, Sec. 13261(f)(5), amended par. (3) by substituting “section 197” for “section 185 or 1253(d)(2) or (3)”.
1990 - Subsec. (a)(3). Pub. L. 101-508, Sec. 11704(a)(13), substituted ‘or (3))’ for ‘or (3)’ in introductory provisions.
Subsec. (a)(3)(C). Pub. L. 101-508, Sec. 11801(c)(6)(E), substituted ‘188 (as in effect before its repeal by the Revenue Reconciliation Act of 1990),’ for ‘188,’.
Subsec. (a)(3)(D). Pub. L. 101-508, Sec. 11813(b)(21), substituted ‘section 168(i)(13)’ for ‘section 48(p)’.
Subsec. (b)(3). Pub. L. 101-508, Sec. 11801(c)(8)(H), struck out ‘371(a), 374(a),’ after ‘332, 351, 361,’.
1989 - Subsec. (a)(2)(C). Pub. L. 101-239, Sec. 7622(b)(2)(A)((d)(2)(A)), substituted ‘193, or 1253(d)(2) or (3)’ for ‘or 193’.
Subsec. (a)(3). Pub. L. 101-239, Sec. 7622(b)(2)(B)((d)(2)(B)), substituted ‘section 185 or 1253(d)(2) or (3)’ for ‘section 185’ in introductory provisions.
1988 - Subsec. (a)(3)(F). Pub. L. 100-647 added subpar. (F).
1986 - Subsec. (a)(1). Pub. L. 99-514, Sec. 201(d)(11)(A), struck out ‘during a taxable year beginning after December 31, 1962, or section 1245 recovery property is disposed of after December 31, 1980,’ after ‘if section 1245 property is disposed of’.
Subsec. (a)(2). Pub. L. 99-514, Sec. 201(d)(11)(B), amended par. (2) generally, restating former subpars. (A) to (E) and concluding provisions as subpars. (A) to (C).
Subsec. (a)(3). Pub. L. 99-514, Sec. 201(d)(11)(C), redesignated subpars. (D), (E), and (F) as (C), (D), and (E), respectively, and struck out former subpar. (C) which read as follows: ‘an elevator or an escalator’.
Subsec. (a)(5), (6). Pub. L. 99-514, Sec. 201(d)(11)(D), struck out par. (5) which defined ‘section 1245 recovery property’ and par. (6) which provided special rule for qualified leased property.
1985 - Subsec. (a)(5)(A) to (C). Pub. L. 99-121 substituted ‘19-year real property’ for ‘18-year real property’.
1984 - Subsec. (a)(5)(A) to (C). Pub. L. 98-369, Sec. 111(e)(5), substituted ‘18-year real property and low-income housing’ for ‘15-year real property’.
Subsec. (d)(5)(D). Pub. L. 98-369, Sec. 111(e)(10), substituted ‘low-income housing (within the meaning of section 168(c)(2)(F))’ for ‘15-year real property which is described in clause (i), (ii), (iii), or (iv) of section 1250(a)(1)(B)’.
1983 - Subsec. (a)(3)(F). Pub. L. 97-448 inserted ‘(not including a building or its structural components)’ after ‘a storage facility’.
1981 - Subsec. (a)(1). Pub. L. 97-34, Sec. 204(a), inserted reference to section 1245 recovery property disposed of after Dec. 31, 1980, in introductory provisions.
Subsec. (a)(2). Pub. L. 97-34, Sec. 202(b)(1)-(3), 204(b), inserted reference to section 179 in subpar. (D), added subpar. (E), and, in provisions following subpar. (E), and inserted references to section 179 in three places. Pub. L. 97-34, Sec. 212(d)(2)(F), in provisions following subpar. (E), substituted ‘191 (as in effect before its repeal by the Economic Recovery Tax Act of 1981)’ for ‘191’ in two places.
Subsec. (a)(3)(D). Pub. L. 97-34, Sec. 202(b)(3), inserted reference to section 179.
Subsec. (a)(3)(E), (F). Pub. L. 97-34, Sec. 201(b), added subpars. (E) and (F).
Subsec. (a)(5). Pub. L. 97-34, Sec. 204(c), added par. (5).
Subsec. (a)(6). Pub. L. 97-34, Sec. 204(d), added par. (6).
1980 - Subsec. (a)(2). Pub. L. 96-451, Sec. 301(c)(1)(A), (B), inserted references to section 194 in subpar. (D) and text following subpar. (D).
Pub. L. 96-223, Sec. 251(a)(2)(C)(i)-(iii), inserted references to section 193 in subpar. (D) and text following subpar. (D).
Subsec. (a)(3)(D). Pub. L. 96-451, Sec. 301(c)(1)(B), inserted reference to section 194.
Pub. L. 96-223, Sec. 251(a)(2)(C)(i), inserted reference to section 193.
Subsec. (b)(8). Pub. L. 96-451, Sec. 301(c)(1)(C), added par. (8).
1978 - Subsec. (a)(2). Pub. L. 95-600, Sec. 701(f)(3)(A), struck out from the listed sections in subpar. (D) reference to 191 and inserted ‘(in the case of property described in paragraph (3)(C))’ before ‘191’ in two places in next to last sentence.
Subsec. (a)(3)(D). Pub. L. 95-600, Sec. 701(f)(3)(B), struck out reference to section 191.
Subsec. (a)(4)(B). Pub. L. 95-600, Sec. 701(w)(2), inserted ‘attributable to periods after December 31, 1975,’ after ‘for the depreciation’, ‘incurred after December 31, 1975,’ after ‘allowable for losses’, and ‘described in clause (i)’ after ‘of the amounts’.
Subsec. (a)(4)(C). Pub. L. 95-600, Sec. 701(w)(1), struck out provisions relating to the aggregate of the amounts treated as ordinary income.
1976 - Subsec. (a)(1). Pub. L. 94-455, Sec. 1901(b)(3)(K), substituted ‘ordinary income’ for ‘gain from the sale or exchange of property which is neither a capital asset nor property described in section 1231’.
Subsec. (a)(2)(D). Pub. L. 94-455, Sec. 2122(b)(3)(B), 2124(a)(2), inserted reference to sections 190 and 191.
Subsec. (a)(2) foll. (D). Pub. L. 94-455, Sec. 1901(b)(11)(D), 1951(c)(2)(C), 2122(b)(3)(A), (C), 2124(a)(2), in text following subpar. (D): struck out reference to section 187 in two places; inserted ‘(as in effect before its repeal by the Tax Reform Act of 1976),’ after ‘section 168,’ in two places; inserted provision for treatment for purposes of this section of any deduction allowable under section 190 as if it were a deduction allowable for amortization; and inserted reference to section 191 in two places, respectively.
Subsec. (a)(3)(D). Pub. L. 94-455, Sec. 2122(b)(3)(A), 2124(a)(2), inserted reference to sections 190 and 191.
Subsec. (a)(4). Pub. L. 94-455, Sec. 212(b)(1), added par. (4).
Subsec. (b)(5). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out ‘or his delegate’ after ‘Secretary’.
Subsec. (b)(7)(B). Pub. L. 94-455, Sec. 1901(a)(140), struck out ‘such organization acquiring such property,’ before ‘such organization’.
Subsec. (c). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out ‘or his delegate’ after ‘Secretary’.
1975 - Subsec. (b)(3), (7). Pub. L. 94-81, Sec. 2(a)(1), (2), inserted reference to par. (7) in par. (3), and added par. (7).
1971 - Subsec. (a)(2). Pub. L. 92-178, Sec. 303(c)(1), inserted reference to section 188 in two places in text following subpar. (D).
Subsec. (a)(3)(B)(ii), (iii). Pub. L. 92-178, Sec. 104(a)(2), substituted ‘research facility’ for ‘research or storage facility’ in cl. (ii) and added cl. (iii).
Subsec. (a)(3)(D). Pub. L. 92-178, Sec. 303(c)(2), inserted reference to section 188.
1969 - Subsec. (a)(2). Pub. L. 91-172, Sec. 212(a)(1), 704(b)(4)(A), (B), added subpar. (C) and inserted references to sections 169, 185, and 187, and added subpar. (D).
Subsec. (a)(3). Pub. L. 91-172, Sec. 212(a)(2), 704(b)(4)(C)-(F), struck out ‘(other than livestock)’ after ‘means any property’ and substituted ‘section 167 (or subject to the allowance of amortization provided in section 185)’ for ‘section 167’ and added subpar. (D).
1964 - Subsec. (a)(2), (3)(C). Pub. L. 88-272 redefined ‘recomputed basis’ with respect to elevators or escalators in par. (2), and inserted subpar. (C) in par. (3).
EFFECTIVE DATE OF 2018 AMENDMENTS
Amendment by Pub. L. 115-141, Div. U, Sec. 401(b)(31), effective March 23, 2018.
EFFECTIVE DATE OF 2014 AMENDMENTS
Amendments by Pub. L. 113-295, Div. A, Sec. 221(a)(34)(H), effective the date of the enactment of this Act [Enacted: Dec. 19, 2014].
Section 221(b)(2) of Pub. L. 113-295, Div. A, provided the following Savings Provision:
“(2) SAVINGS PROVISION.—If—
“(A) any provision amended or repealed by the amendments made by this section applied to—
“(i) any transaction occurring before the date of the enactment of this Act [Enacted: Dec. 19, 2014],
“(ii) any property acquired before such date of enactment, or
“(iii) any item of income, loss, deduction, or credit taken into account before such date of enactment, and
“(B) the treatment of such transaction, property, or item under such provision would (without regard to the amendments or repeals made by this section) affect the liability for tax for periods ending after date of enactment, nothing in the amendments or repeals made by this section shall be construed to affect the treatment of such transaction, property, or item for purposes of determining liability for tax for periods ending after such date of enactment.”
EFFECTIVE DATE OF 2006 AMENDMENTS
Amendments by section 404(b)(3) of Pub. L. 109-432 effective for costs paid or incurred after the date of the enactment of this Act [Enacted: Dec. 20, 2006].
EFFECTIVE DATE OF 2005 AMENDMENTS
Amendments by section 402(a)(6) of Pub. L. 109-135 effective as if included in the provisions of the Energy Policy Act of 2005 [Pub. L. 109-58, Sec. 1263] to which they relate, except with respect to any transaction ordered in compliance with the Public Utility Holding Company Act of 1935 before its repeal.
Amendment by section 403(e)(2) of Pub. L. 109-135 effective as if included in the provisions of the American Jobs Creation Act of 2004 [Pub. L. 108-357, Sec. 244] to which it relates.
Amendment by section 403(i)(2) of Pub. L. 109-135 effective as if included in the provisions of the American Jobs Creation Act of 2004 [Pub. L. 108-357, Sec. 322] to which it relates.
Amendments by section 1323(b)(1) of Pub. L. 109-58 effective for property placed in service after the date of the enactment of this Act [Aug. 8, 2005].
Amendments by section 1331(b)(2) of Pub. L. 109-58 effective for property placed in service after December 31, 2005.
Amendment by section 1363(a) of Pub. L. 109-58 effective for dispositions of property after the date of the enactment of this Act [Enacted: Aug. 8, 2005].
EFFECTIVE DATE OF 2004 AMENDMENTS
Amendments by section 338(b)(5) of Pub. L. 108-357 effective for expenses paid or incurred after December 31, 2002, in taxable years ending after such date.
Amendment by section 886(b)(2) of Pub. L. 108-357 effective for franchises acquired after the date of the enactment of this Act [Enacted: Oct. 22, 2004].
EFFECTIVE DATE OF 1997 AMENDMENTS
Amendments by section 1604(a)(3) of Pub. L. 105-34 shall take effect as if included in the amendments made by section 1913 of the Energy Policy Act of 1992.
EFFECTIVE DATE OF 1996 AMENDMENTS
Amendment by Sec. 1703(n)(6) of Pub. L. 104-188 effective as if included in the provision of the Revenue Reconciliation Act of 1993 to which such amendment relates.
EFFECTIVE DATE OF 1995 AMENDMENTS
IN GENERAL.--The amendments made by section 2(a) of Pub. L. 104-7 shall apply to--
(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 exchange is issued on or after such date.
BINDING CONTRACTS.--
(A) IN GENERAL.--The amendments made by section 2(a) of Pub. L. 104-7 shall not apply to any sale or exchange pursuant to a written contract which was binding on January 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 CERTIFICATE.--
(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 treated as contingent on the issuance of an FCC tax certificate 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.
FCC TAX CERTIFICATE.--For purposes of this subsection, the term “FCC tax certificate” means any certificate 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 Pub. L. 104-7).
EFFECTIVE DATE OF 1993 AMENDMENTS
Amendments by section 13261(f) of Pub. L. 103-66 effective for property acquired after the date of the enactment of this Act [Enacted: Aug. 10, 1993].
EFFECTIVE DATE OF 1990 AMENDMENTS
Amendment by section 11813(b)(21) of Pub. L. 101-508 applicable to property placed in service after Dec. 31, 1990, but not applicable to any transition property (as defined in section 49(e) of this title), any property with respect to which qualified progress expenditures were previously taken into account under section 46(d) of this title, and any property described in section 46(b)(2)(C) of this title, as such sections were in effect on Nov. 4, 1990, see section 11813(c) of Pub. L. 101-508, set out as a note under section 29 of this title.
EFFECTIVE DATE OF 1989 AMENDMENTS
Amendment by Pub. L. 101-239 applicable to transfers after Oct. 2, 1989, but not applicable to any transfer pursuant to a written binding contract in effect on Oct. 2, 1989, and at all times thereafter before the transfer, see section 7622(c)((e)) of Pub. L. 101-239, set out as a note under section 167 of this title.
EFFECTIVE DATE OF 1988 AMENDMENTS
Amendment by Pub. L. 100-647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99-514, to which such amendment relates, see section 1019(a) of Pub. L. 100-647, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1986 AMENDMENTS
Amendment by Pub. L. 99-514 applicable to property placed in service after Dec. 31, 1986, in taxable years ending after such date, with exceptions, see sections 203 and 204 of Pub. L. 99-514, set out as a note under section 168 of this title.
Amendment by Pub. L. 99-514 not applicable to any property placed in service before Jan. 1, 1994, if such property placed in service as part of specified rehabilitations, and not applicable to certain additional rehabilitations, see section 251(d)(2), (3) of Pub. L. 99-514, set out as a note under section 46 of this title.
EFFECTIVE DATE OF 1985 AMENDMENTS
Amendment by Pub. L. 99-121 applicable with respect to property placed in service by the taxpayer after May 8, 1985, with specified exceptions, see section 105(b) of Pub. L. 99-121, set out as a note under section 168 of this title.
EFFECTIVE DATE OF 1984 AMENDMENTS
Amendment by Pub. L. 98-369 applicable with respect to property placed in service by the taxpayer after Mar. 15, 1984, subject to certain exceptions, see section 111(g) of Pub. L. 98-369, set out as a note under section 168 of this title.
EFFECTIVE DATE OF 1983 AMENDMENTS
Amendment by Pub. L. 97-448 effective, except as otherwise provided, as if it had been included in the provision of the Economic Recovery Tax Act of 1981, Pub. L. 97-34, to which such amendment relates, see section 109 of Pub. L. 97-448, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1981 AMENDMENTS
Amendment by sections 201(b), 202(b), and 204(a)-(d) of Pub. L. 97-34 applicable to property placed in service after Dec. 31, 1980, in taxable years ending after that date, see section 209(a) of Pub. L. 97-34, set out as an Effective Date note under section 168 of this title.
Amendment by section 212(d)(2)(F) of Pub. L. 97-34 applicable to expenditures incurred after Dec. 31, 1981, in taxable years ending after such date, see section 212(e) of Pub. L. 97-34, set out as a note under section 46 of this title.
EFFECTIVE DATE OF 1980 AMENDMENTS
Amendment by Pub. L. 96-451 applicable with respect to additions to capital account made after Dec. 31, 1979, see section 301(d) of Pub. L. 96-451, set out as an Effective Date note under section 194 of this title.
Amendment by Pub. L. 96-223 applicable to taxable years beginning after Dec. 31, 1979, see section 251(b) of Pub. L. 96-223, set out as an Effective Date note under section 193 of this title.
EFFECTIVE DATE OF 1978 AMENDMENTS
Amendment by section 701(f)(3)(A), (B) of Pub. L. 95-600 effective as if included within the amendment of subsec. (a)(2), (3)(D) by section 2124 of Pub. L. 94-455, see section 701(f)(8) of Pub. L. 95-600, set out as an Effective and Termination Dates of 1978 Amendments note under section 167 of this title.
Section 701(w)(3) of Pub. L. 95-600 provided that: ‘The amendments made by this subsection (amending this section) shall apply to transfers of player contracts in connection with any sale or exchange of a franchise after December 31, 1975.’
EFFECTIVE DATE OF 1976 AMENDMENTS
Section 212(b)(2) of Pub. L. 94-455 provided that: ‘The amendment made by this subsection (amending this section) applies to transfers of player contracts in connection with any sale or exchange of a franchise after December 31, 1975.’
Amendment by section 1901(a)(140), (b)(3)(K), (11)(D) of Pub. L. 94-455 effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94-455, set out as a note under section 2 of this title.
Amendment by section 1951(c)(2)(C) of Pub. L. 94-455 applicable to taxable years beginning after Dec. 31, 1976, see section 1951(d) of Pub. L. 94-455, set out as a note under section 72 of this title.
Amendment by section 2122(b)(3) of Pub. L. 94-455 applicable to taxable years beginning after Dec. 31, 1976, see section 2122(c) of Pub. L. 94-455, as amended, set out as an Effective Date note under section 190 of this title.
Amendment by section 2124(a)(2) of Pub. L. 94-455 applicable with respect to additions to capital account made after June 14, 1976 and before June 15, 1981, see section 2124(a)(4) of Pub. L. 94-455, set out as an Effective Date note under section 642 of this title.
EFFECTIVE DATE OF 1975 AMENDMENTS
Amendment by Pub. L. 94-81 applicable to dispositions after Dec. 31, 1969, in taxable years ending after such date, with special provision for an election in the case of dispositions occurring before Aug. 9, 1975, see section 2(c) of Pub. L. 94-81, set out as a note under section 1250 of this title.
EFFECTIVE DATE OF 1971 AMENDMENTS
Amendment by section 104(a)(2) of Pub. L. 92-178 applicable to property described in section 50 of this title relating to restoration of credit, see section 104(h) of Pub. L. 92-178, set out as a note under section 48 of this title.
Amendment by section 303(c)(1), (2) of Pub. L. 92-178 applicable to taxable years ending after Dec. 31, 1971, see section 303(d) of Pub. L. 92-178, set out as a note under section 642 of this title.
EFFECTIVE DATE OF 1969 AMENDMENTS
Section 212(a)(3) of Pub. L. 91-172 provided that: ‘The amendments made by paragraphs (1) and (2) (amending this section) shall apply with respect to taxable years beginning after December 31, 1969.’
Amendment by section 704(b)(4) of Pub. L. 91-172 applicable to taxable years ending after Dec. 31, 1968, see section 704(c) of Pub. L. 91-172, set out as a note under section 169 of this title.
EFFECTIVE DATE OF 1964 AMENDMENTS
Amendment by Pub. L. 88-272 applicable with respect to dispositions after Dec. 31, 1963, in taxable years ending after such date, see section 203(f)(3) of Pub. L. 88-272, set out as a note under section 48 of this title.
EFFECTIVE DATE
Section 13(g) of Pub. L. 87-834 provided that: ‘The amendments made by this section (enacting this section and amending sections 167, 170, 301, 312, 341, 453, 613, and 751 of this title) (other than the amendments made by subsection (c) (amending sections 167, 179, and 642 of this title)) shall apply to taxable years beginning after December 31, 1962. The amendments made by subsection (c) shall apply to taxable years beginning after December 31, 1961, and ending after the date of the enactment of this Act (Oct. 16, 1962).’
SAVINGS PROVISION
For provisions that nothing in amendment by sections 11801 and 11813 of Pub. L. 101-508 be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to Nov. 5, 1990, for purposes of determining liability for tax for periods ending after Nov. 5, 1990, see section 11821(b) of Pub. L. 101-508, set out as a note under section 29 of this title.