Section 1231

Section of the Internal Revenue Code that deals with Assets used in a trade or business. Generally, gains on Section 1231 assets are taxed at Capital Gains rates (except for depreciation recapture), and losses are tax deductible as Ordinary Losses. Section 1231 assets include:

1. Vehicles used in business.

2. Machinery used in business.

3. Hotels, office buildings, warehouses, apartments.

The section of the Internal Revenue Code that deals with Assets used in a trade or business. Generally, gains on Section 1231 assets are taxed at Capital Gains rates (except for Depreciation Recapture) and losses are Tax Deductible as Ordinary Income. See also Section 1245, Section 1250.
Examples: Section 1231 assets include:

• vehicles used in business

• machinery used in business

• hotels, office buildings, warehouses, apartments