PORTFOLIO

Depreciation: MACRS and ACRS (Portfolio 531)

Tax Management Portfolio, Depreciation: MACRS and ACRS, No. 531-3rd, is a basic reference tool for determining the depreciation deduction under both the modified accelerated cost recovery system (MACRS) and the original accelerated cost recovery systems (ACRS) of §168. Although MACRS and ACRS are similar in many respects, there are substantial differences between them. Accordingly, this portfolio provides “ACRS Differences” descriptions in connection with each issue with respect to which there is a difference. MACRS applies generally to property placed in service after 1986. ACRS applies generally to property placed in service from 1981 through 1986. Topics covered include effective dates and the anti-churning rules, eligible property, basis, classification of property, computation of the deduction (including the use of statutory or IRS-created tables), and limitations and special rules affecting the availability or amount of the deduction.

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DESCRIPTION

Tax Management Portfolio, Depreciation: MACRS and ACRS, No. 531-3rd, is a basic reference tool for determining the depreciation deduction under both the modified accelerated cost recovery system (MACRS) and the original accelerated cost recovery systems (ACRS) of §168. Although MACRS and ACRS are similar in many respects, there are substantial differences between them. Accordingly, this portfolio provides “ACRS Differences” descriptions in connection with each issue with respect to which there is a difference. MACRS applies generally to property placed in service after 1986. ACRS applies generally to property placed in service from 1981 through 1986. Topics covered include effective dates and the anti-churning rules, eligible property, basis, classification of property, computation of the deduction (including the use of statutory or IRS-created tables), and limitations and special rules affecting the availability or amount of the deduction.

Under both MACRS and ACRS, certain “recovery periods” (analogous to depreciable lives under the pre-ACRS depreciation system of §167) are prescribed and salvage value is ignored. The deduction can generally be computed by simply applying a factor from a statutory or IRS-provided table. More complex computations may be required, however, in many circumstances; these circumstances and the required computations are described in this portfolio.


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AUTHORS

JAMES EDWARD MAULE
James Edward Maule, B.S., University of Pennsylvania (1973); J.D., Villanova University (1976); LL.M. (Taxation), George Washington University (1979); lecturer, Villanova University Graduate Tax Program and Tax Forum CLE Programs; lecturer, Philadelphia Bar Association Tax Section; member, U.S. Income Advisory Board, Tax Management Inc.; former attorney-advisor, United States Tax Court, Judge Herbert L. Chabot; former attorney-advisor, Chief Counsel to the Internal Revenue Service; former Editorial Advisory Board member and Columnist, Journal of Limited Liability Companies; former lecturer, ALI-ABA; former lecturer, Tax Management, Inc. & Continuing Legal Education Satellite Network; former lecturer, Pennsylvania Bar Institute; former lecturer, Georgetown University Law Center Institute on State and Local Taxation; former lecturer, The Dickinson School of Law CLE Programs; member, American Bar Association, Section of Taxation, Committee on S Corporations (Consultant and former Chair, Subcommittee on Subchapter S and State Law; former Chair, Subcommittee on Comparison of Partnerships and S Corporations); member, American Bar Association, Section of Taxation, Committee on Teaching Taxation (Chair, Subcommittee on Manuscripts and Unpublished Teaching Materials; member, Subcommittee on Important Developments); member, American Bar Association, Section of Taxation, Tax Practice Management Committee; member, American Bar Association, Section of Taxation, Formation of Tax Policy Committee; member, American Bar Association, Section of Taxation, Committee on Tax Structure and Simplification; former Chair, American Bar Association, Section of Taxation, Phaseout Tax Elimination Project; former member, American Bar Association, Section of Taxation, Task Force on Pass-Through Entities; former member, American Bar Association, Section of Taxation, Task Force on Legislative Recommendation No. 86-1; former member, Philadelphia Bar Association Tax Section; author and owner, TaxJEM Inc., publisher of computer assisted legal instruction programs; owner, JEMBook Publishing Company, publisher of law and genealogy books; author of numerous books, monographs, and book chapters; contributor to various tax periodicals.

TABLE OF CONTENTS

Detailed Analysis

I. Introduction

A. Overview

B. Legislative Background

C. Changes in Method of Depreciation

II. Effective Dates

A. In General

1. Effective Date Periods

2. Placement in Service

a. In General

b. Buildings Housing Equipment

B. Election for Property Placed in Service After July 31, 1986, and Before MACRS Effective Date Period

1. In General

2. Acceleration Benefit

3. Postponement of Benefits

4. Alternative Minimum Tax Benefit

C. Transitional Rules

1. In General

2. Binding Contract Exception

a. In General

b. Class Life

c. Definition of Binding Contract

(1) Contract

(2) Binding

(3) At All Times Thereafter

(4) Transfers of Rights Under Binding Contracts

3. Construction-in-Progress Exception

a. In General

b. Class Life

c. Definition of Construction

4. Equipped Building/Plant Facility Exception

a. In General

b. Class Life

c. Definition of Equipped Building/Plant Facility

5. Supply or Service Contract Exception

a. In General

b. Class Life

6. Exempt-Financed Property Exception

a. In General

b. Construction/Binding Contract Condition

c. Refunding Condition

7. Sale-Leaseback Exception

D. Anti-Churning Rules

1. In General

2. The § 1245 Class Property Anti-Churning Rules

a. In General

b. Exceptions

(1) Property Acquired Through Death

(2) Property Under Construction

c. Scope of Exclusion from MACRS and ACRS

d. Change in User

e. Related Person

(1) In General

(2) Application of Relationship Tests

(3) Application to Partnerships

(4) Application to Corporations

f. Section 1245 Class Property

(1) In General

(2) Incidental Acquisitions

3. The § 1250 Class Property Anti-Churning Rules

a. In General

b. Exceptions

(1) Property Acquired Through Death

(2) Property Under Construction

c. Scope of Exclusion from MACRS and ACRS

d. Related Person

e. Section 1250 Class Property

4. Nonrecognition Transaction Anti-Churning Rule

a. Application

b. Nonrecognition Transactions Affected

5. Anti-Abuse Anti-Churning Rule

6. Special Rule for Partnerships

7. Limitations on the MACRS Anti-Churning Rules

III. Property Eligible for MACRS or ACRS

A. In General

B. Tangible Property

C. Trade, Business, or For-Profit Use

1. In General

2. Definition of Trade or Business

a. In General

b. Profit Motive

c. Scope of the Activities

d. Common Situations

3. Used in a Trade or Business

4. Held for the Production of Income

a. In General

b. Production of Income

(1) Income Motive

(2) Income

5. Effect of Personal Use

D. Of a Character Subject to the Allowance for Depreciation

1. In General

2. Land and Improvements

3. Other Items

a. Fuels and Related Materials

b. Works of Art

c. Precious Metals

d. Rotable Parts

E. Exclusions from MACRS and ACRS

1. In General

2. Property Not Placed in Service During Effective Date Period

3. Election of Another Method

a. In General

b. Method Not Expressed in Terms of Years

c. Election Procedures

(1) Time and Manner

(2) By Whom Made

(3) Revocability

(4) Scope

4. Films and Video Tapes

5. Sound Recordings

6. Certain Public Utility Property

a. In General

b. Public Utility Property

c. Normalization Method of Accounting

(1) In General

(2) Deemed Failure to Use Normalization Method

(3) Taxpayers Filing Consolidated Returns

(4) Contributions in Aid of Construction

d. Special Transitional Rules

F. Possession of Economic Interest in the Property

1. In General

2. Security Title

3. Executory Contracts of Sale

4. Leased Property

5. Life Tenants and Trust and Estate Beneficiaries

6. Tax Shelters

7. Cost Contributors

G. Foreign Corporations and Nonresident Aliens

H. Community Property

IV. Unadjusted Basis

A. In General

B. Basis Rules

1. In General

2. Purchase Basis

3. Gift Basis

4. Basis on Acquisition from Decedent

5. Basis on Acquisition from Spouse or Former Spouse

6. Exchange Basis

C. Reductions in Unadjusted Basis

1. In General

2. Amortization Amounts

a. In General

b. Section 169 Amortization

c. Section 167(k) Amortization

3. Section 179 Expensing Amounts

4. Additional First-Year Depreciation

5. Investment Credit

6. Personal Use

D. Special Rule for Partnerships

1. In General

2. Basis Adjustment Increases

3. Basis Adjustment Decreases

E. Special Rule for Sound Recordings Under ACRS

V. Recovery Period and Classification of Property

A. In General

1. Introduction

a. Basic Classifications

b. Assignment of Property to Recovery Period

c. Exceptions

(1) Alternative Depreciation System

(2) Indian Reservation Property

2. Class Life for MACRS Purposes

a. Class Assignment: In General

b. Class Assignment: Leased Property

c. Class Assignment: Change in Status

d. Class Assignment Under MACRS

e. Changes in Class Life Assignments

3. Present Class Life for ACRS Purposes

4. Section 1245 Class Property for ACRS Purposes

5. Section 1250 Class Property for ACRS Purposes

B. Three-Year Property

1. In General

2. Three-Year Class Life Property

3. Qualified Rent-to-Own Property

4. Certain Horses

5. Research and Experimentation Property for ACRS Purposes

C. Five-Year Property

1. In General

2. Five-Year Class Life Property

3. Automobiles and Light Trucks

4. Semi-Conductor Manufacturing Equipment

5. Certain Telephone Switching Equipment

6. Qualified Technological Equipment

a. In General

b. Computers and Peripheral Equipment

c. High Technology Telephone Station Equipment

d. High Technology Medical Equipment

7. Property Used in Research and Experimentation

8. Qualified Energy Property

a. In General

b. Energy Investment Credit Property

(1) In General

(2) Solar or Wind Energy Property

(3) Solar Illumination Property

(4) Geothermal Energy Property

(5) Fuel Cell Property

(6) Microturbine Property

(7) Combined Heat and Power System Property

(8) Small Wind Energy Property

(9) Geothermal Heat Pump System

c. Qualified Biomass Property

d. Ocean Thermal Energy Property

9. Qualified Farming Business Machinery and Equipment

10. Qualified New York Liberty Zone Leasehold Improvement Property

a. In General

b. Election Out

D. Seven-Year Property for MACRS Purposes

1. In General

2. Seven-Year Class Life Property

3. Railroad Track

4. Motorsports Entertainment Complex

5. Alaska Natural Gas Pipeline

6. Natural Gas Gathering Lines

7. Property Lacking Class Life

E. Ten-Year Property

1. In General

2. Ten-Year Class Life Property for MACRS Purposes

3. Agricultural and Horticultural Structures for MACRS Purposes

a. In General

b. Agricultural and Horticultural Structures Defined

4. Trees or Vines Bearing Fruits or Nuts for MACRS Purposes

5. Qualified Smart Electric Meters

6. Qualified Smart Electric Grid Systems

7. Certain Public Utility Property for ACRS Purposes

8. Certain § 1250 Property for ACRS Purposes

9. Railroad Tank Cars for ACRS Purposes

10. Manufactured Homes for ACRS Purposes

11. Qualified Coal Utilization Property for ACRS Purposes

F. Fifteen-Year Property for MACRS Purposes

1. In General

2. Fifteen-Year Class Life Property

3. Certain Wastewater Plants

4. Certain Telephone Distribution Property

5. Certain Retail Motor Fuels Outlet Stores

a. In General

b. Election

6. Qualified Leasehold Improvement Property

7. Qualified Restaurant Property

8. Gas Utility Initial Clearing and Grading Land Improvements

9. Electricity Transmission Property

10. Natural Gas Distribution Lines

11. Qualified Retail Improvement Property

G. Fifteen-Year Public Utility Property for ACRS Purposes

H. Twenty-Year Property for MACRS Purposes

1. In General

2. Twenty-Year Class Life Property

3. Certain Municipal Sewers

4. Electric Utility Initial Clearing and Grading Land Improvements

I. Twenty-Five-Year Water Utility Property

J. Fifteen-Year Real Property for ACRS Purposes

1. In General

2. Fifteen-Year Effective Date Period

a. In General

b. Qualified Person

c. Binding Contract

d. Commencement of Construction

e. Application to Partnerships

3. Components and Improvements

K. Eighteen-Year Real Property for ACRS Purposes

1. In General

2. Eighteen-Year Effective Date Period

3. Components and Improvements

L. Nineteen-Year Real Property for ACRS Purposes

1. In General

2. Nineteen-Year Effective Date Period

3. Components and Improvements

M. Low-Income Housing for ACRS Purposes

N. Twenty-Seven-and-One-Half-Year Residential Rental Property for MACRS Purposes

O. Thirty-One-and-One-Half-Year Nonresidential Real Property for MACRS Purposes

1. In General

2. Thirty-One-and-One-Half-Year Effective Date Period

P. Thirty-Nine-Year Nonresidential Real Property for MACRS Purposes

Q. Fifty-Year Railroad Property for MACRS Purposes

R. Recovery Periods under the MACRS Alternative Depreciation System

1. In General

2. Property Subject to Alternative Depreciation System

a. In General

b. Property Used Predominantly Outside the United States

(1) Introduction

(2) Used Outside the United States

(3) Predominantly

(4) Exceptions

(a) Aircraft

(b) Railroad Rolling Stock

(c) Vessels

(d) Motor Vehicles

(e) Containers

(f) Outer Continental Shelf Development Property

(g) Possessions Property

(h) Communications Satellites

(i) Cables

(j) Northern Western Hemisphere Ocean Property

(k) Special Ocean Thermal Energy Conversion Equipment

(l) Other Satellites

c. Tax-Exempt Use Property

(1) Introduction

(2) Tax-Exempt Entity

(a) In General

(b) Foreign Persons and Entities

(c) Government Instrumentalities

(d) Former Tax-Exempt Entities

(3) Nonresidential Real Property and Residential Rental Property

(4) Property Other than Nonresidential Real Property and Residential Rental Property

(5) Exception for Short-Term Leases

(6) Exception for Use in Unrelated Trade or Business

(7) Exception for Certain High Technology Equipment

(8) Special Rules for Pass-Through Entities

(9) Like-Kind Exchanges

(10) Related Person

d. Tax-Exempt Bond Financed Property

e. Imported Property Covered by Executive Order

f. Election to Apply Alternative Depreciation System

g. Uniform Capitalization Farming Property

3. Alternative Depreciation System Recovery Periods

a. In General

b. Tax-Exempt Use Property

c. Qualified Rent-to-Own Property

d. Semi-Conductor Manufacturing Equipment

e. Certain Telephone Switching Equipment

f. Qualified Farming Business Machinery and Equipment

g. Railroad Track

h. Alaska Natural Gas Pipeline Property

i. Natural Gas Gathering Lines

j. Agricultural and Horticultural Structures

k. Trees and Vines Bearing Fruits or Nuts

l. Certain Wastewater Plants

m. Certain Communications Equipment

n. Qualified Retail Motor Fuels Outlets

o. Qualified Leasehold Improvement Property

p. Qualified Restaurant Property

q. Gas Utility Initial Clearing and Grading Land Improvements

r. Electricity Transmission Property

s. Natural Gas Distribution Lines

t. Qualified Retail Improvement Property

u. Electric Utility Initial Clearing and Grading Land Improvements

v. Certain Municipal Sewers

w. Qualified Technological Equipment

x. Automobiles and Light Trucks

y. Certain Real Property

z. Qualified NYLZ Leasehold Improvement Property

S. Property Used Predominantly Outside the United States for ACRS Purposes

1. Scope of Provision

a. In General

b. Treatment of Sound Recordings

2. ACRS Recovery Periods for Property Used Predominantly Outside the United States

a. Property Not Low-Income Housing or Real Property

b. Low-Income Housing and Real Property

c. Election of Longer Recovery Periods

T. Retirement-Replacement-Betterment Replacement Property for ACRS Purposes

1. In General

2. RRB Replacement Property

3. Recovery Periods for Qualifying RRB Replacement Property

4. Recovery Periods for Nonqualifying Property

a. Property Placed in Service After December 31, 1980

b. RRB Property

U. Indian Reservation Property

1. In General

2. Qualified Indian Reservation Property

3. Indian Reservation

VI. Recovery Percentages

A. In General

1. The Recovery Percentage Tables

2. Application of Recovery Percentage Tables

B. Applicable Recovery Methods

1. The Double Declining Balance Method

2. The 175% Declining Balance Method for ACRS

3. The 150% Declining Balance Method

a. In General

b. MACRS Farm Business Property

c. Election of the 150% Declining Balance Method for MACRS

4. The Straight-Line Method

a. In General

b. Election to Use the Straight-Line Method

(1) In General

(2) Election Procedures

(a) In General

(i) Timing

(ii) Manner

(iii) By Whom Made

(iv) Deemed Elections

(b) ACRS Rehabilitation Expenditures

(c) Failure to Elect the Straight-Line Method

(d) Foreign Taxpayers

(e) Partnerships

c. Planning Considerations

C. Applicable Conventions

1. Half-Year Convention

2. Mid-Month Convention

a. In General

b. Mid-Month Convention Effective Date Period

3. Full-Month Convention

4. Mid-Quarter Convention

a. In General

b. Mid-Quarter Test

(1) In General

(2) Property Taken Into Account

(3) Aggregate Basis

(4) Planning Considerations

c. Special Rules for Consolidated Groups

(1) Newly Formed Subsidiaries

(2) Corporations Joining or Leaving the Group

(3) Transfers Between Members

d. Nonrecognition Transactions

e. Partnerships and S Corporations

D. The MACRS Tables and Their Use

1. In General

2. Accelerated MACRS Tables

a. Three-Year Property

b. Five-Year Property

c. Seven-Year Property

d. Ten-Year Property

e. Fifteen-Year Property

f. Twenty-Year Property

3. Straight-Line MACRS Tables

a. Regular Percentages

(1) Property Other Than Nonresidential Real Property, Residential Rental Property, and 50-Year Property

(2) Nonresidential Real Property

(3) Residential Rental Property

(4) Fifty-Year Property

b. Alternative Depreciation System

(1) Property Other Than Nonresidential Real Property, Residential Rental Property, and 50-Year Property

(2) Nonresidential Real and Residential Rental Property

(3) Fifty-Year Property

4. Alternative Minimum Tax Tables

E. The ACRS Tables and Their Use

1. Statutory Accelerated ACRS Tables

a. Three-Year Property

b. Five-Year Property

c. Ten-Year Property

d. Fifteen-Year Public Utility Property

e. Fifteen-Year Real Property

f. Eighteen-Year Real Property

g. Nineteen-Year Real Property

h. Low-Income Housing

2. Optional Straight-Line ACRS Tables

a. Property Other Than Real Property and Low-Income Housing

b. Real Property and Low-Income Housing: Full-Month Convention

c. Real Property: Mid-Month Convention

3. ACRS Tables for Property Used Predominantly Outside the United States

a. Accelerated Percentages Tables

(1) Property Other Than Real Property and Low-Income Housing

(2) Real Property and Low-Income Housing

b. Optional Straight-Line Percentages Tables

(1) Property Other Than Real Property and Low-Income Housing

(2) Real Property and Low-Income Housing: Full-Month Convention

(3) Real Property: Mid-Month Convention

4. RRB Replacement Property Tables

a. In General

b. Nonqualifying Property

(1) Property Placed in Service After December 31, 1980

(2) RRB Property

VII. Special Rules Affecting Computation of Deduction

A. In General

B. Listed Property Limitations

1. In General

a. Basic Principles

b. Dollar Limitations

c. Method Limitations and Recapture

2. Listed Property

a. In General

b. Transportation Property

c. Entertainment, Recreation, and Amusement Property

d. Computers and Peripheral Equipment

e. Leased Property

3. Qualified Business Use

a. In General

b. Related Party Leasing

c. Employee Use

4. Application of the Restrictions

a. In General

b. Recapture of Excess Deductions

(1) In General

(2) Excess Depreciation

(3) Lessees

(a) In General

(b) Property Leased After June 18, 1984, and Before January 1, 1987

(c) Property Leased After December 31, 1986

C. Short Taxable Years

1. In General

2. MACRS Deductions

a. In General

b. Impact on Applicable Conventions

(1) In General

(2) Half-Year Convention

(3) Mid-Quarter Convention

c. Deduction for First Taxable Year in Recovery Period

d. Deduction for Subsequent Taxable Years in Recovery Period

(1) In General

(2) Allocation Method

(3) Simplified Method

(4) Switch to Straight-Line Method

e. Return Already Filed Before Publication of Rules

3. ACRS Deductions

a. In General

b. Effect on Subsequent Taxable Years

c. Determining When Taxable Year Begins

D. Year of Disposition

1. In General

2. ACRS Proration for Real Property and Low-Income Housing

3. General Asset and Mass Asset Accounts

a. In General

b. Definition of Disposition of General Asset Accounts

c. Disposition of All Assets in General Asset Account

d. Special Rule for Qualifying Dispositions

(1) In General

(2) Effect of a Qualifying Disposition

e. Tainted Nonrecognition Transactions

f. Like-Kind Exchanges and Involuntary Conversions

g. Anti-Abuse Rule

h. Assets Subject to Recapture

i. Assets Generating Foreign Source Income

(1) In General

(2) Source of Ordinary Income, Gain, or Loss

(3) Computations

j. ACRS Mass Asset Account Investment Credit Recapture

4. Gain or Loss on Disposition of ACRS Property

5. Pre-1981 RRB Property

E. Redeterminations

1. Basis Redeterminations

2. Redeterminations with Respect to ACRS Property

a. In General

b. Redeterminations With Respect to ACRS Property

c. Change in Recovery Class

d. Change in Geographical Character

e. Change to or from Low-Income Housing

F. Changes in Use

1. In General

2. Changes in Use of MACRS Property

a. In General

b. Conversion to Business or Income-Producing Use

c. Conversion to Personal Use

d. Changes in Use After Placed-in-Service Year

(1) In General

(2) Change in Use Causing Shorter Recovery Period or Faster Depreciation Method

(3) Change in Use Causing Longer Recovery Period or Slower Depreciation Method

(4) Use of Optional Depreciation Tables

e. Changes in Use During Placed-in-Service Year

3. Changes in Use of ACRS Property

a. In General

b. Conversion from Personal Use

c. Increase or Decrease in Business Use

G. Components of and Improvements to Real Property

1. Additions and Improvements

2. Structural Components

3. ACRS Exceptions

a. In General

b. Buildings Available in Stages

c. Substantial Improvements

d. Transition Rules

H. General Asset and Mass Asset Accounts

1. In General

2. Election

3. Establishing MACRS General Asset Accounts

a. Eligibility of Assets

b. Grouping Assets

4. Establishing ACRS Mass Asset Accounts

5. Determination of Depreciation Deduction

a. MACRS General Asset Accounts

b. ACRS Mass Asset Accounts

I. Transferee Limitations

1. In General

2. Tainted Nonrecognition Transactions

a. In General

b. Exceptions

3. Application of the Transferee Limitations

a. In General

b. Transferor and Transferee on Same Taxable Year

c. Transferor and Transferee on Different Taxable Years

d. Transferee's Deduction for Subsequent Years

e. Excess Adjusted Basis of Transferee

f. Transferee's Basis Less Than Transferor's Basis

g. Short Taxable Years

J. Reacquisition Limitation

1. In General

2. Exception

3. Resumption of Prior Recovery

4. Excess Adjusted Basis

5. Reacquisition Basis Less Than Adjusted Basis

K. Nonrecognition Transfer Limitations

1. In General

2. Like-Kind Exchanges and Involuntary Conversions: MACRS Property

a. In General

b. Depreciation of Exchanged Basis

(1) In General

(2) Period and Method

(3) Convention

(4) Depreciation for Year of Disposition and Year of Acquisition

(5) Examples of MACRS Deduction for Exchanged Basis

c. Depreciation of Excess Basis

d. Depreciable and Nondepreciable Property

e. Depreciation Limitation for Automobiles

(1) In General

(2) Ordering Rules

f. Involuntary Conversion Replacement Acquired Before Disposition of Relinquished Property

g. Use of Optional Depreciation Tables

h. Election to Use a Simplified Method

i. Election to Treat Certain Replacement Property as MACRS Property

3. Involuntary Conversions: ACRS Property

a. Deduction for Converted Property

b. Deduction for Replacement Property

(1) In General

(2) Months Remaining in Conversion Year Greater Than or Equal to Months of Service in Replacement Year

(3) Months Remaining in Conversion Year Less Than Months of Service in Replacement Year

4. Like-kind Exchanges: ACRS Property

a. Deduction for Surrendered Property

b. Deduction for Acquired Property

(1) In General

(2) Months Remaining in Surrender Year Greater Than or Equal to Months of Service in Acquisition Year

(3) Months Remaining in Surrender Year Less Than Months of Service in Acquisition Year

5. Gifts: ACRS Property

a. Donor and Donee on Same Taxable Year

b. Donor and Donee on Different Taxable Years

c. Donee's Deduction for Subsequent Years

d. Excess Adjusted Basis of Donee

e. Donee's Basis Less Than Donor's Basis

6. Transfers at Death: ACRS Property

L. Cooperatives

M. Partnerships: Ratable Inclusion

N. Determining Lease Term

1. In General

2. The Temporary ACRS Regulations

3. The MACRS Regulations

O. Limitations for Property Financed with Tax-Exempt Bonds

1. In General

2. ACRS Straight-Line Method for Exempt-Financed Property

a. Scope

b. Special ACRS Straight-Line Method

c. Effective Date

d. Exceptions

(1) In General

(2) Tax Equity and Fiscal Responsibility Act of 1982

(3) Deficit Reduction Act of 1984

P. Leasing Transactions

VIII. Miscellaneous Matters

A. Leasehold Improvements

B. Repair Allowances

C. Collateral Effects

1. Alternative Minimum Tax

a. In General

b. MACRS Computation for Alternative Minimum Tax Purposes

(1) In General

(2) Accelerated § 1245 Property

(3) Certain Property Not Eligible for MACRS and Natural Gas Gathering Lines

(4) Public Utility Property

(5) Qualified Indian Reservation Property

c. Computation of ACRS Minimum Tax Preference

2. Earnings and Profits

a. In General

b. ACRS Earnings and Profits Rules

D. Effect on § 167(d) Agreements


WORKING PAPERS

Working Papers

Table of Worksheets

Worksheet 1 Elections Using Form 4562, Depreciation and Amortization

Worksheet 2 MACRS Percentage Tables

Worksheet 3 Tables of Class Lives and Recovery Periods

Worksheet 4 Short Taxable Year Computation Under MACRS (Rev. Proc. 89-15)

Worksheet 5 IRS Safe Harbor Percentages for MACRS Alternative Depreciation System: Intermodel Cargo Containers (Rev. Rul. 90-9, 1990-1 C.B. 46)

Worksheet 6 Depreciation of Retail Motor Fuels Outlets (Rev. Proc. 97-10, 1997-1 C.B. 628, as corrected by Announcement 97-15, 1997-9 I.R.B. 23)

Worksheet 7 ACRS Tables for ACRS Property

Worksheet 8 IRS Tables for Determining "Inclusion Amount" for Lessees of Listed Property Not Used Predominantly in a Trade or Business

Worksheet 9 IRS Standard Mortality Dispersion Table

Worksheet 10 Job Creation and Worker Assistance Act of 2002

Bibliography

OFFICIAL

Statutes:

Public Laws:

United States Code:

Regulations:

Legislative History:

Joint Committee on Taxation Staff Explanations:

Treasury Rulings and Procedures:

Cases:

UNOFFICIAL

Periodicals:

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