Source: http://taxtv.com/code/00712-USCODE-2011-title26-subtitleA-chap1-subchapO-partIII-sec1042/
Timestamp: 2017-03-25 05:52:47
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Matched Legal Cases: ['§1042', '§1042', '§1042', '§541', '§1854', '§1018', '§7303', '§11801', '§1311', '§968', '§1316', '§1704', '§1311', '§1616', '§1018', '§1854', '§1018', '§1018', '§1854', '§1854', '§1854', '§1854', '§1018', '§1854', '§1854', '§1854', '§1018', '§1899', '§1854', '§1854', '§1854', '§1854', '§1854', '§1854', '§1042']

IRC §1042. Sales of stock to employee stock ownership plans or certain cooperatives - TaxTV.com
IRC §1042. Sales of stock to employee stock ownership plans or certain cooperatives
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(ii) any authorized officer of the cooperative described in paragraph (l),
(A) the taxpayer’s cost of purchasing qualified replacement property which the taxpayer claims results in nonrecognition of any part of such gain,
(B) the taxpayer’s intention not to purchase qualified replacement property within the replacement period, or
(i) farmers who make up the eligible farmers’ cooperative which is purchasing stock in the corporation in a transaction to which this subsection is to apply, or
(B) subsection (b)(2) shall be applied by substituting “100 percent” for “30 percent” each place it appears,
(Added Pub. L. 98–369, div. A, title V, §541(a), July 18, 1984, 98 Stat. 887; amended Pub. L. 99– 4, title XVIII, §§1854(a)(1), (2)(A), (3)(B), (4), (5)(A), (6)(A), (7), (8)(A), (9)(B), (10), (11), (f)(3)(B), 1899A(26), Oct. 22, 1986, 100 Stat. 2872–2878, 2882, 2959; Pub. L. 100–647, title I, §1018(t)(4)(D)–(F), Nov. 10, 1988, 102 Stat. 3588; Pub. L. 101–239, title VII, §7303(a), Dec. 19, 1989, 103 Stat. 2352; Pub. L. 101–508, title XI, §11801(c)(9)(H), Nov. 5, 1990, 104 Stat. 1388–526; Pub. L. 104–188, title I, §§1311(b)(3), 1316(d)(3), 1616(b)(13), 1704(t)(50), Aug. 20, 1996, 110 Stat. 1784, 1786, 1857, 1890; Pub. L. 105–34, title IX, §968(a), Aug. 5, 1997, 111 Stat. 895.)
The Tax Reform Act of 1986, referred to in subsec. (c)(4)(A), is Pub. L. 99– 4, which was approved Oct. 22, 1986.
1996—Subsec. (c)(1)(A). Pub. L. 104–188, §1316(d)(3), substituted “domestic C corporation” for “domestic corporation”.
Subsec. (c)(1)(B)(ii). Pub. L. 104–188, §1704(t)(50), provided that section 11801(c)(9)(H) of Pub. L. 101–508 shall be applied as if “section 1042(c)(1)(B)” appeared instead of “section 1042(c)(2)(B)”. See 1990 Amendment note below.
Subsec. (c)(4)(A)(i). Pub. L. 104–188, §1311(b)(3), substituted “section 1362(d)(3)(C)” for “section 1362(d)(3)(D)”.
Subsec. (c)(4)(B)(ii)(I). Pub. L. 104–188, §1616(b)(13), struck out “or 593” after “section 581”.
1988—Subsec. (b)(3), (4). Pub. L. 100–647, §1018(t)(4)(F), made technical correction to Pub. L. 99– 4, §1854(a)(3)(B), see 1986 Amendment notes below.
Subsec. (c)(4)(A). Pub. L. 100–647, §1018(t)(4)(D), inserted “(as in effect immediately before the Tax Reform Act of 1986)” after “section 954(c)(3)” in last sentence.
Subsec. (c)(4)(B)(i). Pub. L. 100–647, §1018(t)(4)(E), substituted “replacement period” for “placement period”.
1986—Pub. L. 99– 4, §1854(a)(11), which directed that “employee” be inserted before “stock” in section catchline was executed by making the insertion before “stock” the second time that term appears as the probable intent of Congress.
Subsec. (a). Pub. L. 99– 4, §1854(a)(1), substituted “the taxpayer or executor elects in such form as the Secretary may prescribe” for “the taxpayer elects” in par. (1) and inserted “which would be recognized as long-term capital gain” in concluding provisions.
Subsec. (b)(2). Pub. L. 99– 4, §1854(a)(2)(A), substituted “Plan must hold” for “Employees must own” in heading and amended text generally. Prior to amendment, par. (2) read as follows: “The plan or cooperative referred to in paragraph (1) owns, immediately after the sale, at least 30 percent of the total value of the employer securities (within the meaning of section 409(l)) outstanding as of such time.”
Subsec. (b)(3). Pub. L. 99– 4, §1854(a)(3)(B), as amended by Pub. L. 100–647, §1018(t)(4)(F), redesignated par. (4) as (3) and struck out former par. (3) which related to plans maintained for benefit of employees.
Subsec. (b)(3)(B). Pub. L. 99– 4, §1854(f)(3)(B), amended subpar. (B) similar to amendment by section 1854(a)(9)(B) of Pub. L. 99– 4, inserting reference to section 4979A.
Pub. L. 99– 4, §1854(a)(9)(B), substituted “sections 4978 and 4979A” for “section 4978(a)”.
Subsec. (b)(4). Pub. L. 99– 4, §1854(a)(3)(B), as amended by Pub. L. 100–647, §1018(t)(4)(F), redesignated par. (4) as (3).
Subsec. (c). Pub. L. 99– 4, §1899A(26), substituted “this section—” for “this section.—” in introductory provision.
Subsec. (c)(1). Pub. L. 99– 4, §1854(a)(4), substituted “stock outstanding that is” for “securities outstanding that are” in subpar. (A), redesignated subpar. (C) as (B), and struck out former subpar. (B) which read as follows: “at the time of the sale described in subsection (a)(1), have been held by the taxpayer for more than 1 year, and”.
Subsec. (c)(4). Pub. L. 99– 4, §1854(a)(5)(A), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “The term ‘qualified replacement property’ means any securities (as defined in section 165(g)(2)) issued by a domestic corporation which does not, for the taxable year in which such stock is issued, have passive investment income (as defined in section 1362(d)(3)(D)) that exceeds 25 percent of the gross receipts of such corporation for such taxable year.”
Subsec. (c)(5). Pub. L. 99– 4, §1854(a)(10), substituted “sold” for “acquired” in heading, and in text substituted “sale of securities” for “acquisition of securities” and inserted “to an employee stock ownership plan or eligible worker-owned cooperative”.
Subsec. (c)(7). Pub. L. 99– 4, §1854(a)(6)(A), added par. (7).
Subsec. (d). Pub. L. 99– 4, §1854(a)(7), inserted last sentence.
Subsecs. (e), (f). Pub. L. 99– 4, §1854(a)(8)(A), added subsec. (e) and redesignated former subsec. (e) as (f).
Section 968(b) of Pub. L. 105–34 provided that: “The amendment made by this section [amending this section] shall apply to sales after December 31, 1997.”
Section 7303(b) of Pub. L. 101–239 provided that: “The amendment made by this section [amending this section] shall apply to sales after July 10, 1989.”
Amendment by section 1854(a)(1), (2)(A), (4), (5)(A), (7), (10), (11) of Pub. L. 99– 4 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99– 4, set out as a note under section 48 of this title.
Amendment by section 1854(a)(3)(B) of Pub. L. 99– 4 applicable to sales of securities after Oct. 22, 1986, except that a taxpayer or executor may elect to have section 1042(b)(3) of the Internal Revenue Code of 1954 (as in effect before the amendment by section 1854(a)(3)(B) of Pub. L. 99– 4) apply to sales before Oct. 22, 1986, as if section 1042(b)(3) included the last sentence of section 409(n)(1) of this title (as added by section 1854(a)(3)(A) of Pub. L. 99– 4), see section 1854(a)(3)(C) of Pub. L. 99– 4, as amended, set out as a note under section 409 of this title.
Section 1854(a)(6)(B)–(D) of Pub. L. 99– 4 provided that:
Section 1854(a)(8)(B) of Pub. L. 99– 4 provided that: “The amendment made by subparagraph (A) [amending this section] shall apply to dispositions after the date of the enactment of this Act [Oct. 22, 1986], in taxable years ending after such date.”
Amendment by section 1854(a)(9)(B) of Pub. L. 99– 4 applicable to sales of securities after Oct. 22, 1986, see section 1854(a)(9)(D) of Pub. L. 99– 4, set out as an Effective Date note under section 4979A of this title.
Amendment by section 1854(f)(3)(B) of Pub. L. 99– 4 effective Oct. 22, 1986, see section 1854(f)(4)(A) of Pub. L. 99– 4, set out as a note under section 409 of this title.
Section 541(c) of Pub. L. 98–369 provided that: “The amendments made by this section [enacting this section and amending sections 1016 and 1223 of this title] shall apply to sales of securities in taxable years beginning after the date of enactment of this Act [July 18, 1984].”
Section 968 of Pub. L. 105–34, amending this section and enacting provisions set out as a note above, was subject to line item veto by the President, Cancellation No. 97–2, signed Aug. 11, 1997, 62 F.R. 43267, Aug. 12, 1997. For decision holding line item veto unconstitutional, see Clinton v. City of New York, 524 U.S. 417, 118 S.Ct. 2091, 141 L.Ed.2d 393 (1998).
Section 1854(a)(2)(B) of Pub. L. 99– 4 provided that:
“ ‘(2) Employees must own 30 percent of stock after sale.—The plan or cooperative referred to in paragraph (1) owns, immediately after the sale, at least 30 percent of the employer securities or 30 percent of the value of employer securities (within the meaning of section 409(1)) outstanding at the time of sale.’ ”
Section 1854(a)(5)(B) of Pub. L. 99– 4 provided that: “If—
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