hedging transaction

(2) Hedging transaction (A) In general For purposes of this section, the term “hedging transaction” means any transaction entered into by the taxpayer in the normal course of the taxpayer’s trade or business primarily— (i) to manage risk of price changes or currency fluctuations with respect to ordinary property which is held or to be held by the taxpayer, (ii) to manage risk of interest rate or price changes or currency fluctuations with respect to borrowings made or to be made, or ordinary obligations incurred or to be incurred, by the taxpayer, or (iii) to manage such other risks as the Secretary may prescribe in regulations. (B) Treatment of nonidentification or improper identification of hedging transactions Notwithstanding subsection (a)(7), the Secretary shall prescribe regulations to properly characterize any income, gain, expense, or loss arising from a transaction— (i) which is a hedging transaction but which was not identified as such in accordance with subsection (a)(7), or (ii) which was so identified but is not a hedging transaction.


26 USC § 1221(b)(2)

Scoping language

For purposes of this section
Is this correct? or