1.26 Ark. Code R. 51-412(a)
For purposes of the Income Tax Act, no gain or loss shall be recognized in an exchange of property for like property of a similar value.
If property held for productive use in trade or business or for investment (not including stock in trade or other property held primarily for sale, nor stocks, bonds, notes, certificates of trust or beneficial interest or other securities or evidence of indebtedness) is exchanged solely for property of like kind to be held either for productive use in trade or business or for investment, no gain or loss is recognized.
The words "like kind" have reference to the nature or character of the property and not its grade or quality. Therefore, under this paragraph, no gain or loss is realized by one, other than a dealer, from the exchange of real estate for other real estate. One kind or class of property may not, under this paragraph, be exchanged for property of a different kind or class, as real estate for personal property.
If property, real, personal or mixed, is transferred to a corporation by one person solely in exchange for stock or securities in such corporation and, immediately after the exchange, such person is in control of the corporation, or by two or more persons solely in exchange for stock or securities in such corporation, and if, immediately after the exchange, such persons are in control of the corporation, and the amount of stock and securities received by each is substantially in proportion to his interest in the property prior to the exchange, no gain or loss will be recognized.
If common stock in a corporation is exchanged solely for common stock in the same corporation, or if preferred stock in a corporation is exchanged solely for preferred stock in the same corporation by one person solely in exchange for stock or securities in such corporation and, immediately after the exchange, such person is in control of the corporation, or by two or more persons solely in exchange for stock or securities in such corporation, and if, immediately after the exchange, such persons are in control of the corporation, and the amount of stock and securities received by each is substantially in proportion to his interest in the property prior to the exchange, no gain or loss will be recognized.
1.26 Ark. Code R. 51-412(a)