Business Property

About Business Property:

generally, any property used in a trade or business that is not a capital asset. Business Assets are assets used for purposes of carrying on a business. Business property includes assets specifically excepted from capital asset status, such as: • inventory.

• property held for sale to customers in the ordinary course of business.

• trade receivables from the sale of property or services in the normal course of business.

• depreciable personal property used in a trade or business.

• real property used in a trade or business.

• intangible assets such as copyrights or trademarks.

The sale or exchange of the first three items results in ordinary income or ordinary loss. The last three items receive special treatment under Section 1231, as any gain from disposition is treated as a capital gain and any loss as an ordinary loss.

See also other Tax Terms and Definitions in U.S.A.

Section 1221.

See also Capital Gain in the American Legal Encyclopedia and Capital Gain in the World Legal Encyclopedia.