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Title 26, Internal Revenue CodeRelease 119-110

§6050J Returns Relating to Foreclosures and Abandonments of Security

Title 26 › Subtitle F — Procedure and Administration › CHAPTER 61 — INFORMATION AND RETURNS › Subchapter A — Returns and Records › PART III — INFORMATION RETURNS › Subpart B — Information Concerning Transactions With Other Persons › § 6050J

Last updated Sep 22, 2026|Official source

Summary

If you lend money as part of a business and you end up owning the property that was used as security for the loan, or you learn the secured property was abandoned, you must file a report with the Secretary at the time the Secretary’s rules require. The rule does not apply to a loan to a person that is secured only by tangible personal property that is not held for investment and not used in a business. The report must be in the form the Secretary requires and must show the borrower’s name and address, a simple description of the property and the debt, and specific numbers: for an acquisition, the debt amount when you took the property and how much debt was satisfied; for an abandonment, the debt amount at that time. The law treats government units as “persons,” and they must file even if not in business; a designated official files for them. Lenders must also give each named borrower a written notice with a contact name, address, and phone by January 31 of the year after the report. Transfers of the secured property to someone other than the lender can be treated as an abandonment if the Secretary’s rules so provide.

Full Legal Text

Title 26, §6050J

Internal Revenue Code, Source: USLM XML via OLRC

(a)In general
Any person who, in connection with a trade or business conducted by such person, lends money secured by property and who—
(1)in full or partial satisfaction of any indebtedness, acquires an interest in any property which is security for such indebtedness, or
(2)has reason to know that the property in which such person has a security interest has been abandoned,
shall make a return described in subsection (c) with respect to each of such acquisitions or abandonments, at such time as the Secretary may by regulations prescribe.
(b)Exception
Subsection (a) shall not apply to any loan to an individual secured by an interest in tangible personal property which is not held for investment and which is not used in a trade or business.
(c)Form and manner of return
The return required under subsection (a) with respect to any acquisition or abandonment of property—
(1)shall be in such form as the Secretary may prescribe,
(2)shall contain—
(A)the name and address of each person who is a borrower with respect to the indebtedness which is secured,
(B)a general description of the nature of such property and such indebtedness,
(C)in the case of a return required under subsection (a)(1)—
(i)the amount of such indebtedness at the time of such acquisition, and
(ii)the amount of indebtedness satisfied in such acquisition,
(D)in the case of a return required under subsection (a)(2), the amount of such indebtedness at the time of such abandonment, and
(E)such other information as the Secretary may prescribe.
(d)Applications to governmental units
For purposes of this section
(1) Treated as persons
(2)Special rules
In the case of a governmental unit or any agency or instrumentality thereof— (A)
(B)any return under this section shall be made by the officer or employee appropriately designated for the purpose of making such return.
(e)Statements to be furnished to persons with respect to whom information is required to be furnished
Every person required to make a return under subsection (a) shall furnish to each person whose name is required to be set forth in such return a written statement showing the name, address, and phone number of the information contact of the person required to make such return. The written statement required under the preceding sentence shall be furnished to the person on or before January 31 of the year following the calendar year for which the return under subsection (a) was made.
(f)Treatment of other dispositions
To the extent provided by regulations prescribed by the Secretary, any transfer of the property which secures the indebtedness to a person other than the lender shall be treated as an abandonment of such property.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

1996—Subsec. (e). Pub. L. 104–168 substituted “name, address, and phone number of the information contact” for “name and address”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1996 AmendmentAmendment by Pub. L. 104–168 applicable to statements required to be furnished after Dec. 31, 1996 (determined without regard to any extension), see section 1201(b) of Pub. L. 104–168, set out as a note under section 6041 of this title.

Effective Date

Pub. L. 98–369, div. A, title I, § 148(d), July 18, 1984, 98 Stat. 689, provided that: “The

Amendments

made by this section [enacting this section and amending section 6652 and 6678 of this title] shall apply with respect to acquisitions of property and abandonments of property after December 31, 1984.”

Reference

Citations & Metadata

Citation

26 U.S.C. § 6050J

Title 26, Internal Revenue Code

Last Updated

Sep 22, 2026

Release point: 119-110