US Codex
U.S.C.
Notes

§461. General rule for taxable year of deduction — Inbound Citations

26 U.S.C. § 461

Cited by 17 provisions in release 119-102.

Citations to 26 U.S.C. § 461 as a whole

Citations to §461(c)

Citations to §461(f)

Citations to §461(h)

Citations to §461(h)(2)

Citations to §461(i)(3)

  • (3) The term “tax shelter” has the meaning given such term by section 461(i)(3) (determined after application of paragraph (4) thereof). An S corporation shall not be treated as a tax shelter for purposes of this section merely by reason of being required to file a notice of exemption from registration with a State agency described in section 461(i)(3)(A), but only if there is a requirement applicable to all corporations offering securities for sale in the State that to be exempt from such registration the corporation must file such a notice.

Citations to §461(i)(3)(A)

  • (3) The term “tax shelter” has the meaning given such term by section 461(i)(3) (determined after application of paragraph (4) thereof). An S corporation shall not be treated as a tax shelter for purposes of this section merely by reason of being required to file a notice of exemption from registration with a State agency described in section 461(i)(3)(A), but only if there is a requirement applicable to all corporations offering securities for sale in the State that to be exempt from such registration the corporation must file such a notice.

Citations to §461(k)

Citations to §461(k)(2)(E)

Citations to §461(k)(4)

  • (B) For purposes of subparagraph (A), the term “syndicate” means any partnership or other entity (other than a corporation which is not an S corporation) if more than 35 percent of the losses of such entity during the taxable year are allocable to limited partners or limited entrepreneurs (within the meaning of section 461(k)(4)).
  • (C) For purposes of subparagraph (B), an interest in an entity shall not be treated as held by a limited partner or a limited entrepreneur (within the meaning of section 461(k)(4))—
    (i) for any period if during such period such interest is held by an individual who actively participates at all times during such period in the management of such entity,
    (ii) for any period if during such period such interest is held by the spouse, children, grandchildren, and parents of an individual who actively participates at all times during such period in the management of such entity,
    (iii) if such interest is held by an individual who actively participated in the management of such entity for a period of not less than 5 years,
    (iv) if such interest is held by the estate of an individual who actively participated in the management of such entity or is held by the estate of an individual if with respect to such individual such interest was at any time described in clause (ii), or
    (v) if the Secretary determines (by regulations or otherwise) that such interest should be treated as held by an individual who actively participates in the management of such entity, and that such entity and such interest are not used (or to be used) for tax–avoidance purposes.
    For purposes of this subparagraph, a legally adopted child of an individual shall be treated as a child of such individual by blood.
  • (C) In the case of any gain from a transaction recognized by an entity which is allocable to a limited partner or limited entrepreneur (within the meaning of section 461(k)(4)), subparagraph (A) shall not apply if—
    (i) substantially all of the limited partner’s (or limited entrepreneur’s) expected return from the entity is attributable to the time value of the partner’s (or entrepreneur’s) net investment in such entity,
    (ii) the transaction (or the interest in the entity) was marketed or sold as producing capital gains treatment from a transaction described in subsection (c)(1), or
    (iii) the transaction (or the interest in the entity) is a transaction (or interest) specified in regulations prescribed by the Secretary.