SEVENTIETH CONGRESS . SESS. I . CH. 852 . 1928 . (3) TR ANS FER IN TRU ST AFT ER DEC EMBE R 31, 1920 .-If the property was acquired after December 31, 1920, by a transfer in trust (other than by a transfer in trust by a bequest or devise) the basis shall be the same as it would be in the hands of the gran tor, increa sed i n the amoun t of gain or dec rease d in the amount of loss recognized to the grantor upon such transfer under the law applicable to the year in which the transfer was made ; (4) GIFT OR TRANSFER IN TRUST BEFORE JAN UA RY 1, 1921 .-If the prope rty wa s acq uired by gift or transfer in trust on or befo re De cember 31, 1920, the b asis shall be the fair market valu e of such p roper ty at the time of such acquisition . The provisions of this paragraph shall apply to the acquisition of such property interests as are specified in section 402(e) of the Revenue Act of 1921, or in section 302(f) of the Revenue Act of 1924 or the Revenue Act of 1926 (relating to property passing under power of appointment) regardless of the time of acquisition ; (5) PROPERTY TRANSMITTED AT DEATH .-If personal property was acquired by specific bequest, or if real property was acquired by general or specific devise or by intestacy, the basis shall be the fair market value of the property at the time of the death of the decedent. If the property was acquired by the decedent's estate from the decedent, the basis in the hands of the estate shall be the fair market value of the property at the time of the death of the decedent . In all other cases if the property was acquired either by will or by intestacy, the basis shall be the fair market value of the property at the time of the distribution to the taxpayer . In the case of property transferred in trust to pay the income for life to or u pon the order or directi on of th e grantor, with the right reserved to the grantor at all times prior to his death to revoke the trust, the basis of such property in the hands of the persons entitled under the terms of the trust instrument to the property after the grantor's death shall, after such death, be the same as if the trust instrument had been a will executed on the day of the grantor's death
(6) TAX-F REE EXCHAN GES GENERALLY .-If the property was acquired upon an exchange described in section 112(b) to (e), inc lu siv e, the bas is shall be the s ame as in the c ase of the property exchanged, decreased in the amount of any money recei ved b y the taxpa yer a nd inc rease d in the am ount of gain or decreased in the amount of loss to the taxpayer that was recognized upon such exchange under the law applicable to the yea r in wh ich the e xch ange was made . If the property so acquired consisted in part of the type of property permitted by section 112(b) to be received without the recognition of gain or loss, and in part of other property, the basis provided in this paragraph shall be allocated between the properties (other than money) received, and for the purpose of the allocation there shall be assigned to such other property an amount equival ent to i ts fair market v alue at the date of the exchange . This paragraph shall not apply to property acquired by a corporation by the issuance of its stock or securities as the con side rati on in wh ole or in pa rt for the t rans fer of the property to it ; (7) TRANSFERS TO CO RPORATION WHERE CONTROL OF PROPERTY REMAINS IN SAME PERS ONS .-If t he pr opert y was acqui red a fter December 31, 1917, by a corporation in connection with a reor- ganization, and immediately after the transfer an interest or control in such pr operty of 80 per centum or more remained 819 INCOME TAX Trust pro pert y ac- quired after December 31, 1920, as in hands of gra ntor . Gifts or trusts before Decem ber 3 1, 1 920, fair market value . Under power of ap- pointment . Vol.42,p.279;V01.43, p. 305; Vol. 44, p.71. Property acquired by bequests, devises, etc . Trans fers in trust with right of revoca- tion . Acquired on ex- change, etc . Partly by exchange, and partly by other property . Stock issued as con- sideration excepted . Property other than stock acquired by same corporation after De- cember 31, 1917 .
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