§ 933" rzrw I6.-INT1 $33. Amomt or `gninpderlyed or lm from saber shea; dinositw of property.-··(e) Except as hereinafter provided in this section, the gain from the sale or other tion of property shell be the excms of the amount rultxed therefrom over the basis provided in subdivision (a) or (b) oteection 9.% ot this title, and the lem shall M the excws ot sneh heels over the eéeunt realised. · (b) In gornputlng the amount of gain or loss under. subdivision (a) proper adjnamwt eha1l‘be_ made for (1) any ermnditnre properly chargeable to capital- account, and. (2) any ttm ot lem, exhaustion, wear nndltear, ohsolescence, amortiutloia, or depletion, previously allowed respect to auch property. I { M (el Hhe amount realized tromf the sale or other disposltion
- of property shalt be! the sum of any money received plus the
fnir market value of- the property (other than money`) received. id) In the com ein sale or exchange,/the e;tént__to which the`. gain or loss determined nnder. this section shall be recognized for the pur o£_ thin chapter shall be determlned nndér the provisions ot o - _ e - · W je) Noth@ in this section shell be construed to previent (in the ease of property sold under contract ppmgaaing for pay- _ ment in i&ilments) the taxetion of that portion of any oinstnllnrent payment representing gain or pront in the gycar in _ which wchqpayrnent to recelvm. · (Jq¤e‘z,y 1924, 4.01 p.>·m., c. 34, { W, 43 Stat; , ·» _ V Q · " ~ 934. Gains or 1% not rewgnizdr-¤(a) ._Upon"the sale or exchange of property the entire amount of the gain or loss, determined under section %3 of thin title, shall be recognized, except as hereinafter provided in this section. ` (h) (1) Nognin or lose shall be recognized if property held for productire use in trnde or. business or for investment (not including stock in ‘ trade or other property held priinarilye for pole, [nor stocks. bonds, notge, choses ln action; certlhcates of trpst or beneneial interest, or other securities or {evidences of indebtedness or 1iue¤·ee¢>· is exchanged solely for property of at like kind to be held either forfproducttvénse ln trade or businem or for investment, or it common stock ina corporation is exchanged sexeay for common stock in ithe same corporation or if preferred stock in a corporation `is exchanged solely for pre-
ferrm stock ln the same corporation. · V - ·‘
· (2) No gain or lose shall be recognized ltstoclr orsecurltim ina corporation a party to a reorganization are, in pursuance of the wanpof reorganization} exchanged solely for stock or securities in such corporation or in another corporation, a party to the reorganization. p c i" —· i ` _· (3) No gain or lone shall be recognized if a—·eorporation ae party to a reorganization exchanges property, in pursuance of the plan of reorgnnllzation, solely & stock or securities in another corporation a party to the reorganlzationr (4) No gnlnor Ions shall be recognized it property is tremeferred to a corporation hy one or more persons w1e1y‘m"-exchange for stock or securities in such corporation, and immediately after the exchange-such personor persons are in control of the corporation; but in thecase ot an exchange by two or more persons this paragraph shall opply only itthe amount of the stock and securities received by each is substantially in proportion to his lntermt in the property prior to the exchange. (5} -I£ property (ue a result oi its dwtruction in whole or in port, theft. or eeiznre, or an exercise of the power of requisition or condemnation, or the threat or imnxlnence thereof). is compnlsorlly or involuntarily converted into property similar or minted in service or me to the property so comverted, or into money which is forthwith in good `fnlth, under regulations prescribed by the commissioner with the approvel of the Secretary, expended in the ecqnialtion of other property similar or related in service or use to the property so converted, or ln the acquisition oi control pot a corporation
WRHAL REVENUI 810 · owniaj such other property, or Ln the establishment of a re- V pmzemm fund, nwgoin; or loss shell be recognized. IQ my port of the money is not so expended, tho going! any, shell to _ ’ recognized, but in an amount not in excess of the &0l}8Y~Whl€h' is not w expended. _ . 4 (c)‘ If there in distributed, in pursusnce sofa pls; of mor. · gahization, to a shareholder in ¤· cormottou a party to me reorganization, stock pr securities i¤_ such corporation or in ouother corporstloo aébnrty to the reoxmoizntion, withoot tho surrender (by `mch shareholder of stock pr smorities in gm-3; s ccorpomuon, ooygelu to the distributee from tho receipt or Y such stock or wcuritlwihall be " o (d)·‘ (L) Ifiucexchapge would be vdthis the provlolom; or psragrsph (1), (2), or (4) ollsubéividoh (hk if it were not t "forthe fact that the property received mexchsnge wasfsts not only of property w e o tted fby sm paragraph to be reoeivorl withopt the l’9•?0$BiU® of Sim. but uso of other property or ' money} then the gain; it ani, to the reéiwont sm}! be recog- .nizeel,_but in su amotmt not-in excms of the mm of mosh mono; and the fair market value of such i>r@ty. _ ’ ·_ ;(2)_ It}; distrjbution mgde t¤.¤mrma¤ce_of·• msn of reorganization is withirr the provisions. of parsnam (1) but has tho ' éffegt of the distributlori/of s tarhble xllvideod, two there shall be taied “a dividend to each distrimtee nach on anoout of thegsin recognized mnder (1) as is notin execs - of his ramble share of the m1dis¤1huted*_@mi¤gs and proéts ¥ of the corporation accumolétw atm: February- 23,*1913. The _ remdinder, if éhy, of the gain éndér paragraph {1) , shall be taxed as s goin from the exchange of property. ‘ - " (e) It an exchange would be wit}1i¤(the~provlsi0¤s ot mrogmph (3) of subdivision (b) lt it were not for the tact that tho property received in "exchahge mrxslsts not only of stock or securities permitted by such `piarograph to be received without ·t.hé7"1'8(`fQgIlifiOIl of gain, but Yalso ot other property or usooey, then-- W ‘ · » W- V · . (_1)_—; It the corporationfrecelvlng such other property or money distributes it_ in purstvnce of the plan of reorganization, no gals to the corporation shdll he recognized from the exchange, but ’ (2) If the corporation receiving such other property or money does not distribute it ip pursuance ot the plan of reorénizatiou, the gain, if any, to tHe corporation shall be rccwhized, that in on amount not in excess ot_ the sdm oftsuch mom; and the fair market valoe ot such other property, so received, which is not so distributed. · .= A. _( — _ (I) If an ex angé worild be within the provisions of partgraph, (1), (2Jih(3_), or- (4) olsuwlvision .(b) if it were w for the 1 1'sct. that the property received ih exchange ccadsts not only ot property pcrmlttml by such · paragraph to be rc— _ ceivcd without the recognition of gain or lox, but also of otmr property or money, · then ho loss from the exchange shall he recognized. _ G I ‘· _· » _ (g) The distribution, in pursuance of a plan ot rcorpotxation, by or on behalf of `ajcorporntioa a mrty to the reorganization, of its stock or securities or stock or securities in s corporation a party to the reorganization, shall not be came sidcred a distribution of earnings or proéts within the meanixigrot subdivision `(b) of section %2 for the purpw G! dotéf- mioiug the taxablllty of subsequent dlstribxitlous by the corporation. _ » _ _ . ` (h-) As used in this section and sections 932 and %5—=- (1) The term "reorgmrization ” means·*(A) a_ zixcrger or consolidation (including the acquisition by one- corporation of ot least a majority of the voting stock and at least o majority of the total number of shares of all other classm of stock of `nnother corporatiorq or substantially all the properties of anothor corporation), or (B) Ma transfer byu corporgtion of all ops part of its assets to another corporation if immediotcly after the transfer the trnusteror or its stockholders or both J-; ft
