Title 26, Internal Revenue CodeRelease 119-110

§1287 Denial of Capital Gain Treatment for Gains on Certain Obligations Not in Registered Form

Title 26 › Subtitle A — Income Taxes › CHAPTER 1 — NORMAL TAXES AND SURTAXES › Subchapter P — Capital Gains and Losses › PART V — SPECIAL RULES FOR BONDS AND OTHER DEBT INSTRUMENTS › Subpart D — Miscellaneous Provisions › § 1287

Last updated Sep 22, 2026|Official source

Summary

If an obligation that must be in registered form is issued in a nonregistered form, any profit from selling or otherwise getting rid of it must be treated as ordinary income, unless its issuance was already taxed under section 4701. The term "registration-required obligation" is defined in section 163(f)(2). The term "registered form" has the same meaning as in section 163(f).

Full Legal Text

Title 26, §1287

Internal Revenue Code, Source: USLM XML via OLRC

(a)In general

If any registration-required obligation is not in registered form, any gain on the sale or other disposition of such obligation shall be treated as ordinary income (unless the issuance of such obligation was subject to tax under section 4701).

(b)Definitions

For purposes of subsection (a)—

(1)Registration-required obligation

The term “registration-required obligation” has the meaning given to such term by section 163(f)(2).

(2)Registered form

The term “registered form” has the same meaning as when used in section 163(f).

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

2010—Subsec. (b)(1). Pub. L. 111–147 struck out “except that clause (iv) of subparagraph (A), and subparagraph (B), of such section shall not apply” before period.

Statutory Notes and Related Subsidiaries

Effective Date

of 2010 AmendmentAmendment by Pub. L. 111–147 applicable to obligations issued after the date which is 2 years after Mar. 18, 2010, see section 502(f) of Pub. L. 111–147, set out as a note under section 149 of this title.

Effective Date

Section applicable to taxable years ending after July 18, 1984, except as otherwise provided, see section 44 of Pub. L. 98–369, set out as a note under section 1271 of this title.

Reference

Citations & Metadata

Citation

26 U.S.C. § 1287

Title 26, Internal Revenue Code

Last Updated

Sep 22, 2026

Release point: 119-110