# 26 U.S.C. § 1252: Gain from disposition of farm land

Source: OLRC release point 119-134 <https://uscode.house.gov/us/usc/119-134/t26/s1252>. Cite pinpoints as 26 U.S.C. § 1252(a)(1).

## § 1252(a) General rule

**§ 1252(a)(1) Ordinary income.** Except as otherwise provided in this section, if farm land which the taxpayer has held for less than 10 years is disposed of, the lower of—

**§ 1252(a)(1)(A)** the applicable percentage of the aggregate of the deductions allowed under section 175 (relating to soil and water conservation expenditures) for expenditures made by the taxpayer with respect to the farm land or

**§ 1252(a)(1)(B)** the excess of—

**§ 1252(a)(1)(B)(i)** the amount realized (in the case of a sale, exchange, or involuntary conversion), or the fair market value of the farm land (in the case of any other disposition), over

**§ 1252(a)(1)(B)(ii)** the adjusted basis of such land,

shall be treated as ordinary income. Such gain shall be recognized notwithstanding any other provision of this subtitle.

**§ 1252(a)(2) Farm land.** For purposes of this section, the term “farm land” means any land with respect to which deductions have been allowed under section 175 (relating to soil and water conservation expenditures).

**§ 1252(a)(3) Applicable percentage.** For purposes of this section— If the farm land is disposed of—The applicablepercentage is— Within 5 years after the date it was acquired100 percent. Within the sixth year after it was acquired80 percent. Within the seventh year after it was acquired60 percent. Within the eighth year after it was acquired40 percent. Within the ninth year after it was acquired20 percent. 10 years or more years after it was acquired0 percent.

## § 1252(b) Special rules

Under regulations prescribed by the Secretary, rules similar to the rules of section 1245 shall be applied for purposes of this section.

## Regulations

- [Treas. Reg. § 1.1252-1](/26/reg/1.1252-1.md): General rule for treatment of gain from disposition of farm land. (interprets § 1252)
- [Treas. Reg. § 1.1252-2](/26/reg/1.1252-2.md): Special rules. (interprets § 1252)

## Proposed regulations (not in force)

- [Prop. Treas. Reg. § 1.1252-2](/26/prop/1.1252-2_2014-25487.md): Special rules. (REG-151416-06, proposed 2014-11-03)

## Connections

Cites: § 175 Soil and water conservation expenditures; endangered species recovery expenditures; § 1245 Gain from dispositions of certain depreciable property

Cited by: § 751 Unrealized receivables and inventory items

## Amendments

- 1969-12-30: [Pub. L. 91-172](/26/act/91-172.md), 83 Stat. 572
- 1976-10-04: [Pub. L. 94-455](/26/act/94-455.md), 90 Stat. 1793
- 1984-07-18: [Pub. L. 98-369](/26/act/98-369.md), 98 Stat. 854
- 1986-10-22: [Pub. L. 99-514](/26/act/99-514.md), 100 Stat. 2221
- 2014-12-19: [Pub. L. 113-295](/26/act/113-295.md), 128 Stat. 4049
- 2018-03-23: [Pub. L. 115-141](/26/act/115-141.md), 132 Stat. 1204