---
kind: "section"
citation: "26 U.S.C. § 272"
title: "26"
title_heading: "Internal Revenue Code"
number: "272"
heading: "Disposal of coal or domestic iron ore"
release: "119-102"
url: "https://uscodex.org/usc/26/272"
units:
  - "Subtitle A — Income Taxes"
  - "Chapter 1 — Normal Taxes and Surtaxes"
  - "Subchapter B — Computation of Taxable Income"
  - "Part IX — Items Not Deductible"
---

# §272. Disposal of coal or domestic iron ore


Where the disposal of coal or iron ore is covered by [section 631](/usc/26/631.md), no deduction shall be allowed for expenditures attributable to the making and administering of the contract under which such disposition occurs and to the preservation of the economic [interest](/usc/26/856.md?p=f-1) retained under such contract, except that if in any [taxable year](/usc/26/441.md?p=b) such expenditures plus the adjusted depletion basis of the coal or iron ore disposed of in such [taxable year](/usc/26/441.md?p=b) exceed the amount realized under such contract, such excess, to the extent not availed of as a reduction of gain under [section 1231](/usc/26/1231.md), shall be a loss deductible under [section 165(a)](/usc/26/165.md?p=a). This section shall not apply to any [taxable year](/usc/26/441.md?p=b) during which there is no income under the contract.


## Source credit

(Aug. 16, 1954, ch. 736, 68A Stat. 82; Pub. L. 88–272, title II, § 227(a)(3), (b)(3), Feb. 26, 1964, 78 Stat. 98.)

## Notes

### Editorial Notes

### Amendments

1964—Pub. L. 88–272 inserted “or domestic iron ore” in section catchline, and “or iron ore” wherever appearing in text.

### Statutory Notes and Related Subsidiaries

### Effective Date of 1964 Amendment

Pub. L. 88–272, title II, § 227(c), Feb. 26, 1964, 78 Stat. 98, provided that: “The amendments made by this section [amending this section and sections 631, 1016, 1231, and 1402 and section 411 of Title 42, The Public Health and Welfare] shall apply with respect to amounts received or accrued in taxable years beginning after December 31, 1963, attributable to iron ore mined in such taxable years.”