### Question
How does SPECIAL RULES FOR DETERMINING CAPITAL GAINS AND LOSSES define net section 1231 loss?


### Answer
Under *26 U.S.C. § 1231*, **net section 1231 loss** is defined as:

> the excess of—


(A) the section 1231 losses, over


(B) the section 1231 gains

#### Citation:
  - *26 U.S.C. § 1231*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter P-Capital Gains and Losses > PART IV-SPECIAL RULES FOR DETERMINING CAPITAL GAINS AND LOSSES**

