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APPENDIX B
SEC. 475. MARK TO MARKET ACCOUNTING METHOD FOR DEALERS
IN SECURITIES.
(a) General Rule.--Notwithstanding any other
provision of this subpart, the following rules shall
apply to securities held by a dealer in securities:
(1) Any security which is inventory in
the hands of the dealer shall be included in
inventory at its fair market value.
(2) In the case of any security which is
not inventory in the hands of the dealer and
which is held at the close of any taxable
year--
(A) the dealer shall recognize
gain or loss as if such security
were sold for its fair market value
on the last business day of such
taxable year, and
(B) any gain or loss shall be
taken into account for such taxable
year.
Proper adjustment shall be made in the amount of any
gain or loss subsequently realized for gain or loss
taken into account under the preceding sentence. The
Secretary may provide by regulations for the
application of this paragraph at times other than the
times provided in this paragraph.
(b) Exceptions.--
(1) In general.--Subsection (a) shall
not apply to--
(A) any security held for
investment,
(B)(i) any security described
in subsection (c)(2)(C) which is
acquired (including originated) by
the taxpayer in the ordinary course
of a trade or business of the
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