### Question
What does applicable trade or business mean?


### Answer
**Applicable trade or business** has the following meaning in *26 U.S.C. § 1061*:

> any activity conducted on a regular, continuous, and substantial basis which, regardless of whether the activity is conducted in one or more entities, consists, in whole or in part, of—


(A) raising or returning capital, and


(B) either—


(i) investing in (or disposing of) specified assets (or identifying specified assets for such investing or disposition), or


(ii) developing specified assets

#### Citation:
  - *26 U.S.C. § 1061*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter O-Gain or Loss on Disposition of Property > PART IV-SPECIAL RULES**

