Fireplaces, Heating Stoves, Flues and Chimneys - chimney and surrounding combustibles

I am finishing my basement. My chimney however runs right through the middle of the area I want to finish. I would like to finish / box in the chimney for a more finished look. I plan on leaving the side with the cleanout untouched however. My research suggests that I need to keep a 2" clearance between the chimney and any combustible material. Is this the case for me? I would like to bring my walls right up to the chimney surface without having a gap.

It is hard to distinguish whether this requirement is for fireplaces and/or chimneys. In the basement, my furnace is the only thing that exhausts into the chimney.

Also, when I view the construction of the house around the chimney, I notice combustible materials going right up to it. If the 2" req. applies here as well how come I see what I see? Unless the older codes (1950's) did not req. the same clearances.

Originally chimneys were built right against the sheathing on the house - that has changed-most towns require a one inch gap from the sheathing to the back of the masonry for airflow.As far as your basement,you are right in saying that you must be 2 inches from framing.I would think you need to frame around the chimney with the 2 inch space,however best thing to do is get your local building inspector out there-

pmg - thanks for the reply. At least now I know what I'm working against.