Gain on the sale of qualified securities to an employee stock ownership plan or to an eligible worker-owned cooperative is not recognized by any taxpayer except a C corporation — that is, if the taxpayer or the taxpayer’s executor elects not to recognize the gain and buys qualified replacement property within the replacement period defined below.

An executor may invest the proceeds of a deceased individual’s sale of qualified securities to an ESOP or EWOC in qualified replacement property within the replacement period. The executor also can designate as qualified replacement property any property acquired by the decedent for which a statement of purchase has not been made.

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