§ 6045. Returns of Brokers

(a) General rule

     Every person doing business as a broker shall, when required by the Secretary, make a return, in accordance with such regulations as the Secretary may prescribe, showing the name and address of each customer, with such details regarding gross proceeds and such other information as the Secretary may by forms or regulations require with respect to such business.

(b) Statements to be furnished to customers

     Every person required to make a return under subsection (a) shall furnish to each customer whose name is required to be set forth in such return a written statement showing—

     (1) the name, address, and phone number of the information contact of the person required to make such return, and

     (2) the information required to be shown on such return with respect to such customer.

The written statement required under the preceding sentence shall be furnished to the customer on or before January 31 of the year following the calendar year for which the return under subsection (a) was required to be made.

(c) Definitions

     For purposes of this section—

(1) Broker

     The term "broker" includes—

     (A) a dealer,

     (B) a barter exchange, and

     (C) any other person who (for a consideration) regularly acts as a middleman with respect to property or services.

A person shall not be treated as a broker with respect to activities consisting of managing a farm on behalf of another person.

(2) Customer

     The term "customer" means any person for whom the broker has transacted any business.

(3) Barter exchange

     The term "barter exchange" means any organization of members providing property or services who jointly contract to trade or barter such property or services.

(4) Person

     The term "person" includes any governmental unit and any agency or instrumentality thereof.

(d) Statements required in case of certain substitute payments

     If any broker—

     (1) transfers securities of a customer for use in a short sale or similar transaction, and

     (2) receives (on behalf of the customer) a payment in lieu of—

     (A) a dividend,

     (B) tax-exempt interest, or

     (C) such other items as the Secretary may prescribe by regulations,

during the period such short sale or similar transaction is open, the broker shall furnish such customer a written statement (at such time and in the manner as the Secretary shall prescribe by regulations) identifying such payment as being in lieu of the dividend, tax-exempt interest, or such other item. The Secretary may prescribe regulations which require the broker to make a return which includes the information contained in such written statement.

(e) Return required in the case of real estate transactions

(1) In general

     In the case of a real estate transaction, the real estate reporting person shall file a return under subsection (a) and a statement under subsection (b) with respect to such transaction.

(2) Real estate reporting person

     For purposes of this subsection, the term "real estate reporting person" means any of the following persons involved in a real estate transaction in the following order:

     (A) the person (including any attorney or title company) responsible for closing the transaction,

     (B) the mortgage lender,

     (C) the seller’s broker,

     (D) the buyer’s broker, or

     (E) such other person designated in regulations prescribed by the Secretary.

Any person treated as a real estate reporting person under the preceding sentence shall be treated as a broker for purposes of subsection (c)(1).

(3) Prohibition of separate charge for filing return

     It shall be unlawful for any real estate reporting person to separately charge any customer for complying with any requirement of paragraph (1). Nothing in this paragraph shall be construed to prohibit the real estate reporting person from taking into account its cost of complying with such requirement in establishing its charge (other than a separate charge for complying with such requirement) to any customer for performing services in the case of a real estate transaction.

(4) Additional information required

     In the case of a real estate transaction involving a residence, the real estate reporting person shall include the following information on the return under subsection (a) and on the statement under subsection (b):

     (A) The portion of any real property tax which is treated as a tax imposed on the purchaser by reason of section 164(d)(1)(B).

     (B) Whether or not the financing (if any) of the seller was federally-subsidized indebtedness (as defined in section 143(m)(3)).

(5) Exception for sales or exchanges of certain principal residences

(A) In general

     Paragraph (1) shall not apply to any sale or exchange of a residence for $250,000 or less if the person referred to in paragraph (2) receives written assurance in a form acceptable to the Secretary from the seller that—

     (i) such residence is the principal residence (within the meaning of section 121) of the seller,

     (ii) if the Secretary requires the inclusion on the return under subsection (a) of information as to whether there is federally subsidized mortgage financing assistance with respect to the mortgage on residences, that there is no such assistance with respect to the mortgage on such residence, and

     (iii) the full amount of the gain on such sale or exchange is excludable from gross income under section 121.

If such assurance includes an assurance that the seller is married, the preceding sentence shall be applied by substituting "$500,000" for "$250,000".

The Secretary may by regulation increase the dollar amounts under this subparagraph if the Secretary determines that such an increase will not materially reduce revenues to the Treasury.

(B) Seller

     For purposes of this paragraph, the term "seller" includes the person relinquishing the residence in an exchange.

(f) Return required in the case of payments to attorneys

(1) In general

     Any person engaged in a trade or business and making a payment (in the course of such trade or business) to which this subsection applies shall file a return under subsection (a) and a statement under subsection (b) with respect to such payment.

(2) Application of subsection

(A) In general

     This subsection shall apply to any payment to an attorney in connection with legal services (whether or not such services are performed for the payor).

(B) Exception

     This subsection shall not apply to the portion of any payment which is required to be reported under section 6041(a) (or would be so required but for the dollar limitation contained therein) or section 6051.

(Aug. 16, 1954, ch. 736, 68A Stat. 747; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 97–248, title III, § 311(a)(1), Sept. 3, 1982, 96 Stat. 600; Pub. L. 98–369, div. A, title I, § 150(a), title VII, § 714(e)(1), July 18, 1984, 98 Stat. 690, 961; Pub. L. 99–514, title XV, §§ 1501(c)(4), 1521(a), Oct. 22, 1986, 100 Stat. 2737, 2746; Pub. L. 100–647, title I, § 1015(e)(1)(A), (2)(A), (3), title IV, § 4005(g)(3), Nov. 10, 1988, 102 Stat. 3569, 3570, 3650; Pub. L. 101–239, title VII, § 7814(c)(1), Dec. 19, 1989, 103 Stat. 2413; Pub. L. 101–508, title XI, § 11704(a)(25), Nov. 5, 1990, 104 Stat. 1388–519; Pub. L. 102–486, title XIX, § 1939(a), Oct. 24, 1992, 106 Stat. 3034; Pub. L. 104–168, title XII, § 1201(a)(5), July 30, 1996, 110 Stat. 1469; Pub. L. 104–188, title I, § 1704(o)(1), Aug. 20, 1996, 110 Stat. 1886; Pub. L. 105–34, title III, § 312(c), title X, § 1021(a), Aug. 5, 1997, 111 Stat. 839, 922.)

     1997—Subsec. (e)(5). Pub. L. 105–34, § 312(c), added par. (5).

     Subsec. (f). Pub. L. 105–34, § 1021(a), added subsec. (f).

     1996—Subsec. (b)(1). Pub. L. 104–168 substituted "name, address, and phone number of the information contact" for "name and address".

     Subsec. (e)(3). Pub. L. 104–188 inserted at end "Nothing in this paragraph shall be construed to prohibit the real estate reporting person from taking into account its cost of complying with such requirement in establishing its charge (other than a separate charge for complying with such requirement) to any customer for performing services in the case of a real estate transaction."

     1992—Subsec. (e)(4). Pub. L. 102–486 substituted heading for one which read: "Whether seller’s financing was federally-subsidized" and amended text generally. Prior to amendment, text read as follows: "In the case of a real estate transaction involving a residence, the real estate reporting person shall specify on the return under subsection (a) and the statement under subsection (b) whether or not the financing (if any) of the seller was federally-subsidized indebtedness (as defined in section 143(m)(3))."

     1990—Subsec. (e)(4). Pub. L. 101–508 substituted "reporting person" for "broker".

     1989—Subsec. (e)(3), (4). Pub. L. 101–239 redesignated par. (3), relating to whether seller’s financing was federally-subsidized indebtedness, as (4).

     1988—Subsec. (c)(1). Pub. L. 100–647, § 1015(e)(1)(A), inserted at end "A person shall not be treated as a broker with respect to activities consisting of managing a farm on behalf of another person."

     Subsec. (e)(1). Pub. L. 100–647, § 1015(e)(3)(A), substituted "real estate reporting person" for "real estate broker".

     Subsec. (e)(2). Pub. L. 100–647, § 1015(e)(3), substituted "estate reporting person" for "estate broker" in par. (2) heading and two places in text.

     Subsec. (e)(3). Pub. L. 100–647, § 4005(g)(3), added par. (3) relating to whether seller’s financing was federally-subsidized indebtedness.

     Pub. L. 100–647, § 1015(e)(2)(A), added par. (3) relating to prohibition of separate charge for filing return.

     1986—Subsec. (b). Pub. L. 99–514, § 1501(c)(4), in amending subsec. (c) generally, substituted references to persons required to make a return for former references to persons making a return.

     Subsec. (e). Pub. L. 99–514, § 1521(a), added subsec. (e).

     1984—Subsec. (c)(4). Pub. L. 98–369, § 714(e)(1), added par. (4).

     Subsec. (d). Pub. L. 98–369, § 150(a), added subsec. (d).

     1982—Pub. L. 97–248 designated existing provisions as subsec. (a), substituted "the name and address of each customer, with such details regarding gross proceeds" for "the names of customers for whom such person has transacted any business, with such details regarding the profits and losses" after "may prescribe, showing" and "such business" for "each customer as will enable the Secretary to determine the amount of such profits and losses" after "with respect to", and added subsecs. (b) and (c).

     1976—Pub. L. 94–455 struck out "or his delegate" after "Secretary" wherever appearing.

     Amendment by section 312(c) of Pub. L. 105–34 applicable to sales and exchanges after May 6, 1997, with certain exceptions, see section 312(d) of Pub. L. 105–34, set out as a note under section 121 of this title.

     Section 1021(c) of Pub. L. 105–34 provided that: "The amendment made by this section [amending this section] shall apply to payments made after December 31, 1997."

     Section 1704(o)(2) of Pub. L. 104–188 provided that: "The amendment made by paragraph (1) [amending this section] shall take effect as if included in section 1015(e)(2)(A) of the Technical and Miscellaneous Revenue Act of 1988 [Pub. L. 100–647]."

     Amendment by Pub. L. 104–168 applicable to statements required to be furnished after Dec. 31, 1996 (determined without regard to any extension), see section 1201(b) of Pub. L. 104–168, set out as a note under section 6041 of this title.

     Section 1939(b) of Pub. L. 102–486 provided that: "The amendment made by subsection (a) [amending this section] shall apply to transactions after December 31, 1992."

     Amendment by Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title.

     Section 1015(e)(1)(B) of Pub. L. 100–647 provided that: "The amendment made by subparagraph (A) [amending this section] shall take effect as if included in the amendments made by section 311(a)(1) of the Tax Equity and Fiscal Responsibility Act of 1982 [Pub. L. 97–248]."

     Section 1015(e)(2)(B) of Pub. L. 100–647 provided that: "The amendment made by subparagraph (A) [amending this section] shall take effect on the date of the enactment of this Act [Nov. 10, 1988]."

     Amendment by section 1015(e)(3) of Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.

     Amendment by section 4005(g)(3) of Pub. L. 100–647 applicable to financing provided, and mortgage credit certificates issued, after Dec. 31, 1990, with certain exceptions, see section 4005(h)(3) of Pub. L. 100–647, set out as a note under section 143 of this title.

     Amendment by section 1501(c)(4) of Pub. L. 99–514 applicable to returns the due date for which (determined without regard to extensions) is after Dec. 31, 1986, see section 1501(e) of Pub. L. 99–514, set out as an Effective Date note under section 6721 of this title.

     Section 1521(c) of Pub. L. 99–514 provided that: "The amendments made by this section [amending this section and section 3406 of this title] shall apply to real estate transactions closing after December 31, 1986."

     Section 150(b) of Pub. L. 98–369 provided that: "The amendment made by this section [amending this section] shall apply to payments received after December 31, 1984."

     Amendment by section 714(e)(1) of Pub. L. 98–369 effective as if included in the provision of the Tax Equity and Fiscal Responsibility Act of 1982, Pub. L. 97–248, to which such amendment relates, see section 715 of Pub. L. 98–369, set out as a note under section 31 of this title.

     Section 311(c)(1) of Pub. L. 97–248, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: "The amendments made by subsection (a) [amending this section and section 6678 of this title] shall take effect on the date of the enactment of this Act [Sept. 3, 1982], except that—

"(A) regulations relating to reporting by commodities and securities brokers shall be issued under section 6045 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] (as amended by this Act) within 6 months after the date of the enactment of this Act [Sept. 3, 1982], and

"(B) such regulations shall not apply to transactions occurring before January 1, 1983."

     Section 714(e)(2) of Pub. L. 98–369, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: "No penalty shall be imposed under the Internal Revenue Code of 1986 [formerly I.R.C. 1954] with respect to any person required (by reason of the amendment made by paragraph (1) [amending this section]) to file a return under section 6045 of such Code with respect to any payment before January 1, 1985."

     This section is referred to in sections 1400C, 3406, 6041, 6049, 6721, 6722, 6724, 7603 of this title.