26 U.S.C. § 1249
§ 1249. Gain from certain sales or exchanges of patents, etc., to foreign corporations
No plain-English explainer yet. Below is the official text. Explainers are being added section by section.
History
Added in 1962 by the Public Law 87-834. Last changed December 19, 2014 by the Tax Increase Prevention Act of 2014.
Every change, newest first (4)
- December 19, 2014Tax Increase Prevention Act of 2014
- October 4, 1976Tax Reform Act of 1976
- November 13, 1966Public Law 89-809
- October 16, 1962Public Law 87-834 · added this section
The law as written
Current through Public Law 119-102. Amendment notes omitted.
Structure
Gain from the sale or exchange of a patent, an invention, model, or design (whether or not patented), a copyright, a secret formula or process, or any other similar property right to any foreign corporation by any United States person (as defined in section 7701(a)(30)) which controls such foreign corporation shall, if such gain would (but for the provisions of this subsection) be gain from the sale or exchange of a capital asset or of property described in section 1231, be considered as ordinary income.
For purposes of subsection (a), control means, with respect to any foreign corporation, the ownership, directly or indirectly, of stock possessing more than 50 percent of the total combined voting power of all classes of stock entitled to vote. For purposes of this subsection, the rules for determining ownership of stock prescribed by section 958 shall apply.