[Code of Federal Regulations]
[Title 26, Volume 11]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.1081-10]

[Page 192-193]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
GAIN OR LOSS ON DISPOSITION OF PROPERTY--Table of Contents
 
Sec. 1.1081-10  Nonapplication of other provisions of the Internal Revenue Code of 1954.

    The effect of section 1081(g) is that an exchange, sale, or 
distribution which is within section 1081 shall, with respect to the 
nonrecognition of gain or loss and the determination of basis, be 
governed only by the provisions of part VI (section 1081 and following), 
subchapter O, chapter 1 of the Code, the purpose being to prevent 
overlapping of those provisions and other provisions of subtitle A of 
the Code. In other words, if by virtue of section 1081 any portion of a 
person's gain or loss on any particular exchange, sale, or distribution 
is not to be recognized, then the gain or loss of such person shall be 
nonrecognized only to the extent provided in section 1081, regardless of 
what the result might have been if part VI (section 1081 and following), 
subchapter O, chapter 1 of the Code, had not been enacted; and 
similarly, the basis in the hands of such person of the property 
received by him in such transaction shall be the basis provided by 
section 1082, regardless of what the basis of such property might have 
been under section 1011 if such part VI had not been enacted. On the 
other hand, if section 1081 does not provide for the nonrecognition of 
any portion of a person's gain or loss

[[Page 193]]

(whether or not such person is another party to the same transaction 
referred to above), then the gain or loss of such person shall be 
recognized or nonrecognized to the extent provided for by other 
provisions of subtitle A of the Code as if such part VI had not been 
enacted; and similarly, the basis in his hands of the property received 
by him in such transaction shall be the basis provided by other 
provisions of subtitle A of the Code as if such part VI had not been 
enacted.