Title 26 — Internal Revenue CodeRelease 119-73
§1032 Exchange of Stock for Property
Title 26 › Subtitle Subtitle A— Income Taxes › Chapter 1— NORMAL TAXES AND SURTAXES › Subchapter O— Gain or Loss on Disposition of Property › Part III— COMMON NONTAXABLE EXCHANGES › § 1032
Summary
A corporation does not report any gain or loss when it receives money or property in exchange for its own stock, including treasury stock. The same is true when an option to buy or sell its own stock lapses or is acquired, or for a securities futures contract on its own stock.
Full Legal Text
Title 26, §1032
Internal Revenue Code — Source: USLM XML via OLRC
(a)No gain or loss shall be recognized to a corporation on the receipt of money or other property in exchange for stock (including treasury stock) of such corporation. No gain or loss shall be recognized by a corporation with respect to any lapse or acquisition of an option, or with respect to a securities futures contract (as defined in section 1234B), to buy or sell its stock (including treasury stock).
(b)For basis of property acquired by a corporation in certain exchanges for its stock, see section 362.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Amendments
2000—Subsec. (a). Pub. L. 106–554 inserted “, or with respect to a securities futures contract (as defined in section 1234B),” after “an option” in second sentence. 1984—Subsec. (a). Pub. L. 98–369 inserted provision that no gain or loss shall be recognized by a corporation with respect to any lapse or acquisition of an option to buy or sell its stock (including treasury stock).
Statutory Notes and Related Subsidiaries
Effective Date
of 2000 Amendment Pub. L. 106–554, § 1(a)(7) [title IV, § 401(j)], Dec. 21, 2000, 114 Stat. 2763, 2763A–651, provided that: “The
Amendments
made by this section [enacting section 1234B of this title and amending this section and section 1091, 1092, 1223, 1233, 1234A, 1256 and 7701 of this title] shall take effect on the date of the enactment of this Act [Dec. 21, 2000].”
Effective Date
of 1984 Amendment Pub. L. 98–369, div. A, title I, § 57(b),
July 18, 1984, 1984, 98 Stat. 574, provided that: “The amendment made by subsection (a) [amending this section] shall apply to options acquired or lapsed after the date of the enactment of this Act [
July 18, 1984] in taxable years ending after such date.”
Reference
Citations & Metadata
Citation
26 U.S.C. § 1032
Title 26 — Internal Revenue Code
Last Updated
Apr 6, 2026
Release point: 119-73