[Code of Federal Regulations]
[Title 26, Volume 11]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.1015-2]

[Page 57]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.1015-2  Transfer of property in trust after December 31, 1920.

    (a) General rule. (1) In the case of property acquired after 
December 31, 1920, by transfer in trust (other than by a transfer in 
trust by a gift, bequest, or devise) the basis of property so acquired 
is the same as it would be in the hands of the grantor increased in the 
amount of gain or decreased 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. If the taxpayer acquired the property by a 
transfer in trust, this basis applies whether the property be in the 
hands of the trustee, or the beneficiary, and whether acquired prior to 
the termination of the trust and distribution of the property, or 
thereafter.
    (2) The principles stated in paragraph (b) of Sec. 1.1015-1 
concerning the uniform basis are applicable in determining the basis of 
property where more than one person acquires an interest in property by 
transfer in trust after December 31, 1920.
    (b) Reinvestment by fiduciary. If the property is an investment made 
by the fiduciary (as, for example, in the case of a sale by the 
fiduciary of property transferred by the grantor, and the reinvestment 
of the proceeds), the cost or other basis to the fiduciary is taken in 
lieu of the basis specified in paragraph (a) of this section.