
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document affected by Public Law 106-554 Section 1(a)(7)[401(c)]]
[Document affected by Public Law 106-554 Section 1(a)(7)[401(j)]]
[CITE: 26USC1032]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                        Subtitle A--Income Taxes
 
                  CHAPTER 1--NORMAL TAXES AND SURTAXES
 
          Subchapter O--Gain or Loss on Disposition of Property
 
                  PART III--COMMON NONTAXABLE EXCHANGES
 
Sec. 1032. Exchange of stock for property


(a) Nonrecognition of gain or loss

    No gain or loss shall be recognized to a corporation on the receipt 
of money or other property in exchange for stock (including treasury 
stock) of such corporation. No gain or loss shall be recognized by a 
corporation with respect to any lapse or acquisition of an option, or 
with respect to a securities futures contract (as defined in section 
1234B), to buy or sell its stock (including treasury stock).

(b) Basis

            For basis of property acquired by a corporation in certain 
        exchanges for its stock, see section 362.

(Aug. 16, 1954, ch. 736, 68A Stat. 303; Pub. L. 98-369, div. A, title I, 
Sec. 57(a), July 18, 1984, 98 Stat. 574; Pub. L. 106-554, Sec. 1(a)(7) 
[title IV, Sec. 401(c)], Dec. 21, 2000, 114 Stat. 2763, 2763A-649.)


                               Amendments

    2000--Subsec. (a). Pub. L. 106-554 inserted ``, or with respect to a 
securities futures contract (as defined in section 1234B),'' after ``an 
option'' in second sentence.
    1984--Subsec. (a). Pub. L. 98-369 inserted provision that no gain or 
loss shall be recognized by a corporation with respect to any lapse or 
acquisition of an option to buy or sell its stock (including treasury 
stock).


                    Effective Date of 2000 Amendment

    Pub. L. 106-554, Sec. 1(a)(7) [title IV, Sec. 401(j)], Dec. 21, 
2000, 114 Stat. 2763, 2763A-651, provided that: ``The amendments made by 
this section [enacting section 1234B of this title and amending this 
section and sections 1091, 1092, 1223, 1233, 1234A, 1256 and 7701 of 
this title] shall take effect on the date of the enactment of this Act 
[Dec. 21, 2000].''


                    Effective Date of 1984 Amendment

    Section 57(b) of Pub. L. 98-369 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply to options 
acquired or lapsed after the date of the enactment of this Act [July 18, 
1984] in taxable years ending after such date.''
