Related Persons: Always Check the Definition - A Lesson from Like-Kind Exchanges

Abstract

<p>When encountering the term “related party” or “related person” in a statute, it is always important to check the definition.<strong>1 </strong>For example, the definitions for the two provisions designed to combat abuse in the installment sales area – the so-called two-year disposition rule<strong>2 </strong>and the sale of depreciable property rule between related persons<strong>3 </strong>– have vastly different “related person” rules<strong>4 </strong>even though they are stabled in the same section of the Internal Revenue Code and deal with similar problems in the abuse area.</p>