# § 1252. Gain from disposition of farm land
**(a)** **General rule**
**(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—
**(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
**(B)** the excess of—
shall be treated as ordinary income. Such gain shall be recognized notwithstanding any other provision of this subtitle.
**(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
**(ii)** the adjusted basis of such land,
**(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).
**(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 acquired | 100 percent. |
| Within the sixth year after it was acquired | 80 percent. |
| Within the seventh year after it was acquired | 60 percent. |
| Within the eighth year after it was acquired | 40 percent. |
| Within the ninth year after it was acquired | 20 percent. |
| 10 years or more years after it was acquired | 0 percent. |
**(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.
---
**Source Credit**: (Added Pub. L. 91–172, title II, § 214(a), Dec. 30, 1969, 83 Stat. 572; amended Pub. L. 94–455, title XIX, §§ 1901(b)(3)(K), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1793, 1834; Pub. L. 98–369, div. A, title IV, § 492(b)(5), July 18, 1984, 98 Stat. 854; Pub. L. 99–514, title IV, § 402(b)(2), Oct. 22, 1986, 100 Stat. 2221; Pub. L. 113–295, div. A, title II, § 221(a)(85), Dec. 19, 2014, 128 Stat. 4049; Pub. L. 115–141, div. U, title IV, § 401(b)(32), Mar. 23, 2018, 132 Stat. 1204.)
## Editorial Notes
### Amendments
2018—Subsec. (a)(1). , struck out “during a taxable year beginning” after “disposed of” in introductory provisions.
Subsec. (a)(1)(A). , substituted “section” for “sections” and “for expenditures” for “and 182 (as in effect on the day before the date of the enactment of the Tax Reform Act of 1986) for expenditures”.
Subsec. (a)(2). , substituted “section” for “sections” and struck out “or 182 (relating to expenditures by farmers for clearing land)” before period at end.
2014—Subsec. (a)(1). , struck out “after ” after “beginning” in introductory provisions.
Subsec. (a)(1)(A). , struck out “after ,” after “taxpayer”.
1986—Subsec. (a)(1)(A). substituted “(as in effect on the day before the date of the enactment of the Tax Reform Act of 1986)” for “(relating to expenditures by farmers for clearing land)”.
1984—Subsec. (a)(1). struck out “, except that this section shall not apply to the extent section 1251 applies to such gain” after “of this subtitle” in last sentence.
1976—Subsec. (a)(1). , substituted “ordinary income” for “gain from the sale or exchange of property which is neither a capital asset nor property described in section 1231”.
Subsec. (b). , struck out “or his delegate” after “Secretary”.
## Statutory Notes and Related Subsidiaries
### Effective Date of 2014 Amendment
Amendment by effective , subject to a savings provision, see , set out as a note under .
### Effective Date of 1986 Amendment
Amendment by applicable to amounts paid or incurred after , in taxable years ending after such date, see , set out as an Effective Date of Repeal note under former .
### Effective Date of 1984 Amendment
Amendment by applicable to taxable years beginning after , see , set out as a note under .
### Effective Date of 1976 Amendment
Amendment by effective for taxable years beginning after , see , set out as a note under .
### Effective Date
> “The amendments made by this section [enacting this section] shall apply to taxable years beginning after
>
> .”
, , , provided that:
### Savings Provision
For provisions that nothing in amendment by be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to , for purposes of determining liability for tax for periods ending after , see , set out as a note under .