DEALERS IN SECURITIES-CAPITAL GAINS AND ORDINARY LOSSES.

SEC. 327. DEALERS IN SECURITIES-CAPITAL GAINS AND ORDINARY LOSSES. Effective with respect to sales or exchanges made after the expiration of the thirtieth day after the date of the enactment of this Act, section 117 is hereby amended by adding at the end thereof the following new subsection: (n) Dealers in Securities.— “(1) Capital gains.— Gain by a dealer in securities from the sale or exchange of any security shall in no event be considered as gain from the sale or exchange of a capital asset unless— “(A) the security was, prior to the expiration of the thirtieth day after the date of its acquisition or after the date of the enactment of the Revenue Act of 1951 (whichever is 65 Stat. 504 the later), clearly identified in the dealer’s records as a security held for investment; and “(B) the security was not, at any time after the expiration of such thirtieth day, held by such dealer primarily for sale to customers in the ordinary course of his trade or business. “(2) Ordinary losses.—Loss by a dealer in securities from the sale or exchange of any security shall, except as otherwise provided in subsection (i) (relating to bond, etc., losses of banks), in no event be considered as loss from the sale or exchange of property which is not a capital asset if at any time after the thirtieth day following the date of the enactment of the Revenue Act of 1951 the security was clearly identified in the dealer’s records as a security held for investment. “(3) Definition of security.—For the purposes of this subsection the term ‘security’ means any share of stock in any corporation, certificate of stock or interest in any corporation, note, bond, debenture, or evidence of indebtedness, or any evidence of an interest in or right to subscribe to or purchase any of the foregoing.”