26 U.S.C. § 268 — Sale of land with unharvested crop

submitted 72 years ago by ch. 736 to r/title-26-INTERNAL-REVENUE-CODE · 57 words · no verdicts yet

in plain englishAI-generated · not legal advice

If a taxpayer sells land with an unharvested crop still on it, and section 1231 treats that crop as business property, no deduction is allowed for the cost of growing it. This applies whether the cost is an expense, depreciation, or something else. It applies no matter which tax year the cost relates to.

This section limits deductions when a taxpayer sells land along with an unharvested crop still growing on it. If section 1231 treats that unharvested crop as "property used in the trade or business," then in figuring taxable income, no deduction is allowed for anything attributable to producing that crop. This bar applies no matter what kind of cost it is — expenses, depreciation, or otherwise — and no matter which tax year the cost relates to, including the year of the sale.

the actual law source: uscode.house.gov ↗public domain

Where an unharvested crop sold by the taxpayer is considered under the provisions of section 1231 as “property used in the trade or business”, in computing taxable income no deduction (whether or not for the taxable year of the sale and whether for expenses, depreciation, or otherwise) attributable to the production of such crop shall be allowed.

Source credit: (Aug. 16, 1954, ch. 736, 68A Stat. 80.)

history & why it existsrecord from the source credit

1954Enacted · Act of Aug. 16, 1954, ch. 736

A history note hasn’t been published yet. The record shows enactment by ch. 736 on 1954-08-16.

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