Page:United States Statutes at Large Volume 76.djvu/1081

 76 STAT.]

PUBLIC LAW 87^34-OCT. 16, 1%2

1033

"(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. "(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, 371(a), 374(a), 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). 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. "(4)

L I K E KIND EXCHANGES; INVOLUNTARY CON\'ER8IONS, 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— " (A) the amount of gain recognized on such disposition (determined without regard to this section), plus " (B) the fair market value of property acquired which is not section 1245 property and which is not taken into account under subparagraph (A). "(5) SECTION IOTI AND losi TRANSACTIONS.—Under regulations prescribed by the Secretary or his delegate, rules consistent with paragraphs (3) and (4) of this subsection shall apply in the case of transactions described in section 1071 (relating to gain from sale or exchange to effectuate policies of FCC) or section 1081 (relating to exchanges in obedience to S E C orders). "(6)

PROPERTY DISTRIBUTED BY A PARTNERSHIP TO A PARTNER.—

" (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. " (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) 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 "(ii) the amount of such gain to which section 751(b) , - ;, applied. "(c) ADJUSTMENTS TO BASIS.—The Secretary or his delegate 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). " (d) APPLICATION OF SECTION.—This section shall apply notwithstanding any other provision of this subtitle." (2) The table of sections for such part IV is amended by adding 26 USC 1231at the end thereof the following: 1244. "Sec. 1245. Gain from, dispositions of certain depreciable property."

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