How to use define 1231 section?

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What is Section 1231 Property

1231 property, defined by section 1231 of the U.S. Internal Revenue Code, is real or depreciable business property held for over a year. Section 1231 property includes buildings, machinery, land, timber and other natural resources, unharvested crops, cattle, livestock and leaseholds that are at least a year old, but does not include poultry and certain other animals, patents and inventions, or inventory (i.e., goods held for sale to customers).

A section 1231 gain from the sale of a property is taxed at the lower capital gains tax rate versus the rate for ordinary income. If the sold property was held for less than one year, the 1231 gain does not apply.

ekkarill92 answered 1 year ago

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