
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC1222]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                        Subtitle A--Income Taxes
 
                  CHAPTER 1--NORMAL TAXES AND SURTAXES
 
                 Subchapter P--Capital Gains and Losses
 
    PART III--GENERAL RULES FOR DETERMINING CAPITAL GAINS AND LOSSES
 
Sec. 1222. Other terms relating to capital gains and losses

    For purposes of this subtitle--

                     (1) Short-term capital gain

        The term ``short-term capital gain'' means gain from the sale or 
    exchange of a capital asset held for not more than 1 year, if and to 
    the extent such gain is taken into account in computing gross 
    income.

                     (2) Short-term capital loss

        The term ``short-term capital loss'' means loss from the sale or 
    exchange of a capital asset held for not more than 1 year, if and to 
    the extent that such loss is taken into account in computing taxable 
    income.

                     (3) Long-term capital gain

        The term ``long-term capital gain'' means gain from the sale or 
    exchange of a capital asset held for more than 1 year, if and to the 
    extent such gain is taken into account in computing gross income.

                     (4) Long-term capital loss

        The term ``long-term capital loss'' means loss from the sale or 
    exchange of a capital asset held for more than 1 year, if and to the 
    extent that such loss is taken into account in computing taxable 
    income.

                   (5) Net short-term capital gain

        The term ``net short-term capital gain'' means the excess of 
    short-term capital gains for the taxable year over the short-term 
    capital losses for such year.

                   (6) Net short-term capital loss

        The term ``net short-term capital loss'' means the excess of 
    short-term capital losses for the taxable year over the short-term 
    capital gains for such year.

                   (7) Net long-term capital gain

        The term ``net long-term capital gain'' means the excess of 
    long-term capital gains for the taxable year over the long-term 
    capital losses for such year.

                   (8) Net long-term capital loss

        The term ``net long-term capital loss'' means the excess of 
    long-term capital losses for the taxable year over the long-term 
    capital gains for such year.

                     (9) Capital gain net income

        The term ``capital gain net income'' means the excess of the 
    gains from sales or exchanges of capital assets over the losses from 
    such sales or exchanges.

                        (10) Net capital loss

        The term ``net capital loss'' means the excess of the losses 
    from sales or exchanges of capital assets over the sum allowed under 
    section 1211. In the case of a corporation, for the purpose of 
    determining losses under this paragraph, amounts which are short-
    term capital losses under section 1212 shall be excluded.

                        (11) Net capital gain

        The term ``net capital gain'' means the excess of the net long-
    term capital gain for the taxable year over the net short-term 
    capital loss for such year.

For purposes of this subtitle, in the case of futures transactions in 
any commodity subject to the rules of a board of trade or commodity 
exchange, the length of the holding period taken into account under this 
section or under any other section amended by section 1402 of the Tax 
Reform Act of 1976 shall be determined without regard to the amendments 
made by subsections (a) and (b) of such section 1402.

(Aug. 16, 1954, ch. 736, 68A Stat. 322; Pub. L. 88-272, title II, 
Sec. 230(b), Feb. 26, 1964, 78 Stat. 100; Pub. L. 91-172, title V, 
Secs. 511(a), 513(c), Dec. 30, 1969, 83 Stat. 635, 643; Pub. L. 94-455, 
title XIV, Sec. 1402(a)(1), (2), (d), title XIX, Sec. 1901(a)(136), Oct. 
4, 1976, 90 Stat. 1731, 1733, 1787; Pub. L. 98-369, div. A, title X, 
Sec. 1001(a), (e), July 18, 1984, 98 Stat. 1011, 1012.)

                       References in Text

    The Tax Reform Act of 1976, referred to in last sentence, is Pub. L. 
94-455, Oct. 4, 1976, 90 Stat. 1520, as amended. For complete 
classification of this Act and of section 1402 of such Act to the Code, 
see Tables.


                               Amendments

    1984--Pars. (1) to (4). Pub. L. 98-369 substituted ``6 months'' for 
``1 year'', applicable to property acquired after June 22, 1984, and 
before Jan. 1, 1988. See Effective Date of 1984 Amendment note below.
    1976--Pars. (1) to (4). Pub. L. 94-455, Sec. 1402(a)(2), provided 
that ``9 months'' would be changed to ``1 year''.
    Pub. L. 94-455, Sec. 1402(a)(1), provided that ``6 months'' would be 
changed to ``9 months'' for taxable years beginning in 1977.
    Par. (9). Pub. L. 94-455, Sec. 1901(a)(136)(A), substituted 
``Capital gain net income'' and ``capital gain net income'' for ``Net 
capital gain'' and ``net capital gain'' in heading and text.
    Par. (11). Pub. L. 94-455, Sec. 1901(a)(136)(B), substituted ``Net 
capital gain'' and ``net capital gain'' for ``Net section 1201 gain'' 
and ``net section 1201 gain'' in heading and text.
    Pub. L. 94-455, Sec. 1402(d), inserted sentence at end relating to 
length of holding period in case of futures transactions in commodities.
    1969--Par. (9). Pub. L. 91-172, Sec. 513(c), substituted ``The'' for 
``In the case of a corporation, the''.
    Par. (11). Pub. L. 91-172, Sec. 511(a), added par. (11).
    1964--Pars. (9), (10). Pub. L. 88-272 struck out provisions from 
par. (9) relating to taxpayers other than corporations, and inserted 
``In the case of a corporation'' in par. (10).


                    Effective Date of 1984 Amendment

    Amendment by Pub. L. 98-369 applicable to property acquired after 
June 22, 1984, and before Jan. 1, 1988, see section 1001(e) of Pub. L. 
98-369, set out as a note under section 166 of this title.


                    Effective Date of 1976 Amendment

    Section 1402(a)(1) of Pub. L. 94-455 provided that the amendment 
made by that section is effective with respect to taxable years 
beginning in 1977.
    Section 1402(a)(2) of Pub. L. 94-455 provided that the amendment 
made by that section is effective with respect to taxable years 
beginning after Dec. 31, 1977.
    Amendment by section 1901(a)(136) of Pub. L. 94-455 applicable with 
respect to 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.


                    Effective Date of 1969 Amendment

    Amendment by section 513(c) of Pub. L. 91-172 applicable to taxable 
years beginning after Dec. 31, 1969, see section 513(d) of Pub. L. 91-
172, set out as a note under section 1211 of this title.


                    Effective Date of 1964 Amendment

    Amendment by Pub. L. 88-272 applicable to taxable years beginning 
after Dec. 31, 1963, see section 230(c) of Pub. L. 88-272, set out as a 
note under section 1212 of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 32, 265, 4981, 4982 of this 
title.
