§ 1045. Rollover of gain from qualified small business stock to another qualified small business stock
(a)
Nonrecognition of gain
In the case of any sale of qualified small business stock held by a taxpayer other than a corporation for more than 6 months and with respect to which such taxpayer elects the application of this section, gain from such sale shall be recognized only to the extent that the amount realized on such sale exceeds—
(1)
the cost of any qualified small business stock purchased by the taxpayer during the 60-day period beginning on the date of such sale, reduced by
This section shall not apply to any gain which is treated as ordinary income for purposes of this title.
(b)
Definitions and special rules
For purposes of this section—
(2)
Purchase
A taxpayer shall be treated as having purchased any property if, but for paragraph (3), the unadjusted basis of such property in the hands of the taxpayer would be its cost (within the meaning of section
1012).
(3)
Basis adjustments
If gain from any sale is not recognized by reason of subsection (a), such gain shall be applied to reduce (in the order acquired) the basis for determining gain or loss of any qualified small business stock which is purchased by the taxpayer during the 60-day period described in subsection (a).
(4)
Holding period
For purposes of determining whether the nonrecognition of gain under subsection (a) applies to stock which is sold—
(A)
the taxpayer’s holding period for such stock and the stock referred to in subsection (a)(1) shall be determined without regard to section
1223, and
(5)
Certain rules to apply
Rules similar to the rules of subsections (f), (g), (h), (i), (j), and (k) of section
1202 shall apply.