26 U.S.C. § 1231: Property used in the trade or business and involuntary conversions

the section 1231 gains for any taxable year, exceed the section 1231 losses for such taxable year, the section 1231 gains for any taxable year, do not exceed the section 1231 losses for such taxable year, any recognized gain on the sale or exchange of property used in the trade or business, and property used in the trade or business, or any capital asset which is held for more than 1 year and is held in connection with a trade or business or a transaction entered into for profit. The term “section 1231 loss” means any recognized loss from a sale or exchange or conversion described in subparagraph (A). the section 1231 gains shall be included only if and to the extent taken into account in computing gross income, and the section 1231 losses shall be included only if and to the extent taken into account in computing taxable income, except that section 1211 shall not apply. property used in the trade or business, or capital assets which are held for more than 1 year and are held in connection with a trade or business or a transaction entered into for profit, property used in the trade or business, or any capital asset which is held for more than 1 year and is held in connection with a trade or business or a transaction entered into for profit, property of a kind which would properly be includible in the inventory of the taxpayer if on hand at the close of the taxable year, property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business, a patent, invention, model or design (whether or not patented), a secret formula or process, a copyright, a literary, musical, or artistic composition, a letter or memorandum, or similar property, held by a taxpayer described in paragraph (3) of section 1221(a), or a publication of the United States Government (including the Congressional Record) which is received from the United States Government, or any agency thereof, other than by purchase at the price at which it is offered for sale to the public, and which is held by a taxpayer described in paragraph (5) of section 1221(a). Such term includes timber, coal, and iron ore with respect to which section 631 applies. cattle and horses, regardless of age, held by the taxpayer for draft, breeding, dairy, or sporting purposes, and held by him for 24 months or more from the date of acquisition, and other livestock, regardless of age, held by the taxpayer for draft, breeding, dairy, or sporting purposes, and held by him for 12 months or more from the date of acquisition. In the case of an unharvested crop on land used in the trade or business and held for more than 1 year, if the crop and the land are sold or exchanged (or compulsorily or involuntarily converted) at the same time and to the same person, the crop shall be considered as “property used in the trade or business.” The net section 1231 gain for any taxable year shall be treated as ordinary income to the extent such gain does not exceed the non-recaptured net section 1231 losses. the aggregate amount of the net section 1231 losses for the 5 most recent preceding taxable years, over the portion of such losses taken into account under paragraph (1) for such preceding taxable years. the section 1231 gains, over the section 1231 losses. the section 1231 losses, over the section 1231 gains. For purposes of determining the amount of the net section 1231 gain or loss for any taxable year, the rules of paragraph (4) of subsection (a) shall apply.