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SERVICE PROVIDES CLASS LIVES FOR DEPRECIATION PURPOSES.

OCT. 19, 1987

Rev. Proc. 87-56; 1987-2 C.B. 674

DATED OCT. 19, 1987
DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Index Terms
    depreciation
    class life
  • Jurisdictions
  • Language
    English
  • Tax Analysts Electronic Citation
    87 TNT 203-18
Citations: Rev. Proc. 87-56; 1987-2 C.B. 674

Clarified and Modified by Rev. Proc. 88-22

Rev. Proc. 87-56

SECTION 1. PURPOSE

The purpose of this revenue procedure is to set forth the class lives of property that are necessary to compute the depreciation allowances available under section 168 of the Internal Revenue Code, as amended by section 201(a) of the Tax Reform Act of 1986 (Act), 1986-3 (Vol. 1) C.B. 38. Rev. Proc. 87-57, page 17, this Bulletin, describes the applicable depreciation methods, applicable recovery periods, and applicable conventions that must be used in computing depreciation allowances under section 168.

SEC. 2. GENERAL RULES OF APPLICATION

01 IN GENERAL. This revenue procedure specifies class lives and recovery periods for property subject to depreciation under the general depreciation system provided in section 168(a) of the Code or the alternative depreciation system provided in section 168(g).

02 DEFINITION OF CLASS LIFE. Except with respect to certain assigned property described in section 3 of this revenue procedure, for purposes of both the general depreciation system and the alternative depreciation system, the term "class life" means the class life that would be applicable for any property as of January 1, 1986, under section 167(m) of the Code (determined without regard to paragraph 4 thereof and determined as if the taxpayer had made an election under section 167(m)). The class life that would be applicable for any property as of January 1, 1986, under section 167(m), is the asset guideline period (midpoint class life) for the asset guideline class in which such property is classified under Rev. Proc. 83-35, 1983-1 C.B. 745. However, for purposes of the alternative depreciation system, section 168(g)(3)(B) assigns a class life to certain property that is taken into account under section 168 rather than the class life that would be applicable as of January 1, 1986. The class life of property that is either determined as of January 1, 1986, under Rev. Proc. 83-35 or assigned under section 168(g)(3)(B) may be modified by the Secretary pursuant to authority granted under section 168(i)(1). See section 4 of this revenue procedure.

03 REV. PROC. 83-35. Rev. Proc. 83-35 sets out the asset guideline classes, asset guideline periods and ranges, and annual asset guideline repair allowance percentages for the Class Life Asset Depreciation Range System. The asset guideline periods (midpoint class lives) set out in Rev. Proc. 83-35 are also used in defining the classes of recovery property under the Accelerated Cost Recovery System (that is, section 168 of the Code as in effect prior to amendment by section 201 of the Act). Rev. Proc. 83-35 remains effective for property subject to depreciation under those systems. Rev. Proc. 83-35 does not apply to property subject to depreciation under section 168, other than as a basis for determining the class lives of such property under section 2.02 of this revenue procedure.

04 PROPERTY WITH NO CLASS LIFE. Property that is neither described in an asset guideline class listed in section 5 of this revenue procedure nor assigned a class life under section 168(g)(3)(B) of the Code is treated as property having no class life for purposes of section 168 unless and until a class life is prescribed by the Secretary pursuant to the authority granted under section 168(i)(1). See section 4 of this revenue procedure. The general and alternative depreciation systems contain separate rules for classifying property that does not have a class life.

SEC. 3. ASSIGNED PROPERTY WITH ASSIGNED CLASS LIVES, RECOVERY CLASSES, OR RECOVERY PERIODS

Under section 168(i)(1)(E) of the Code, the term "assigned property" means property for which a class life, recovery class, or recovery period is assigned under section 168(e)(3) or section 168(g)(3)(B), (C), or (D), and the term "assigned item" means the class life, recovery class, or recovery period assigned under section 168(e)(3) or section 168(g)(3)(B), (C), or (D). For purposes of the general depreciation system assigned property under section 168(c)(3) is assigned to a recovery class without regard to such property's class life. (See section 3.02 of Rev. Proc. 87-57, this Bulletin.) For purposes of the alternative depreciation system, certain assigned property is assigned a class life under section 168(g)(3)(B), notwithstanding such property's class life as set out in Rev. Proc. 83-35. See section 3.03 of Rev. Proc. 87-57, this Bulletin. For purposes of the alternative depreciation system, certain assigned property is assigned a recovery period under section 168(g)(3)(C), (D), or (E), notwithstanding such property's class life (if any).

SEC. 4. PRESCRIPTION AND MODIFICATION OF CLASS LIVES

01 Section 168(i)(1)(B) of the Code provides that the Secretary, through an office established in the Treasury, shall monitor and analyze actual experience with respect to all depreciable assets. Except in the case of section 1250 property that is residential rental property or nonresidential real property, the Secretary, through that office, (i) may prescribe a new class life for any property, (ii) in the case of assigned property, may modify any assigned item, or (iii) may prescribe a class life for any property that does not have a class life within the meaning of section 2.02 of this revenue procedure. Any class life or assigned item that is prescribed or modified pursuant to this authority shall be used for all purposes in determining depreciation allowances under the general depreciation system and the alternative depreciation system. In the case of assigned property as defined in section 168(i)(1)(E), no class life set forth in this revenue procedure nor any other assigned item may be modified, unless such modification reflects a shortening of such class life, for property placed in service prior to January 1, 1992.

02 Prescription or modification of class lives under the authority granted in section 168(i)(1)(B) of the Code shall reflect the anticipated useful lives, and the anticipated decline in value over time (that is, economic depreciation) of an asset to the industry or other group. Rules and practices governing prescription and modification of class lives pursuant to the authority granted in section 168(i)(1)(B) shall be announced through the office referred to in section 4.01 of this revenue procedure.

SEC. 5. TABLES OF CLASS LIVES AND RECOVERY PERIODS

01 Except for property described in section 5.02, below, the class lives (if any) and recovery periods for property subject to depreciation under section 168 of the Code appear in the tables below. These tables are based on the definition of class life in section 2.02 of this revenue procedure and the assigned items described in section 3 of this revenue procedure.

02 For purposes of depreciation under the general depreciation system, residential rental property has a recovery period of 27.5 years and nonresidential real property has a recovery period of 31.5 years. For purposes of the alternative depreciation system, residential rental and nonresidential real property each has a recovery period of 40 years.

03 Generally, the asset classes in the tables are incorporated from the asset guideline classes in Rev. Proc. 83-35 as of January 1, 1986. However, descriptions of the following asset classes have been amended or added: 00.12, 00.3, 01.221, 01.222, 01.3, 01.4, 36.0, 36.1, 40.4, 48.12, 48.121, 48.31-48.45, 50 and 51. Certain asset guideline classes in Rev. Proc. 83-35 included property on the basis of regulated accounts. For purposes of section 168 of the Code and this revenue procedure, asset classes include property described therein without regard to whether a taxpayer is a regulated public utility or an unregulated company.

04 In addition to specifying class lives for each asset guideline class, the tables list certain property for which a recovery period is assigned, notwithstanding such property's class life (if any). See section 3 of this revenue procedure. The listed assigned property classes (denoted A-E) generally do not correspond to asset guideline classes for which class lives are specified in the tables. The class life (if any) of an item of assigned property described in classes A-E is determined by reference to the asset guideline class (if any) containing such item of property. If an item of assigned property described in classes A-E is not contained in any asset guideline class, such item of property has no class life.

EXAMPLES. Qualified technological equipment as defined in section 168(i)(2) (class B) is assigned a recovery period of 5 years for both the general and alternative depreciation systems, notwithstanding such property's class life (if any). Property which is a computer or peripheral equipment, high technology telephone station equipment installed on the customer's premises or high technology medical equipment within the meaning of section 168(i)(2), may be described in asset guideline class 00.12 (class life 6 years), 48.13 (class life 10 years) or 57.0 (class life 9 years), respectively. Property used in connection with research and experimentation referred to in section 168(e)(3)(B) (class C) is assigned a recovery period of 5 years for the general depreciation system, notwithstanding its class life (if any). Such property's recovery period for the alternative depreciation system is based on its class life (if any). An item of property used in connection with research and experimentation has a class life if such property is contained in an asset guideline class.

05 The following special rules are incorporated from Rev. Proc. 83-35, sections 2.02(iii) and (iv):

1. Asset guideline class 00.3, "Land Improvements," includes "other tangible property" that qualifies under section 1.48-1(d) of the Income Tax Regulations. However, a structure that is essentially an item of machinery or equipment or a structure that houses property used as an integral part of an activity specified in section 48(a)(1)(B)(i) of the Code, if the use of the structure is so closely related to the use of the property that the structure clearly can be expected to be replaced when the property it initially houses is replaced, is included in the asset guideline class appropriate to the equipment to which it is related.

2 Asset class 30.11 includes general rebuilding or rehabilitation costs for the special tools defined in class 30.11 that have been traditionally capitalized as the cost of a new asset.

SEC. 6. EFFECT ON OTHER REVENUE PROCEDURES

Rev. Proc. 83-35 is obsoleted for property that is subject to section 168 of the Code.

The principal author of this revenue procedure is Mr. Rick Robbins of the Corporation Tax Division. For further information regarding this revenue procedure, contact Mr. Rick Robbins on (202) 566-4440 (not a toll-free call).

                                                Recovery Periods

 

                                                   (in years)

 

 

                                          Class  General  Alternative

 

                                           Life   Depre-     Depre-

 

 Asset                                     (in    ciation   ciation

 

 class  Description of assets included    years)  System     System

 

 _____  ______________________________    ______  _______  ___________

 

 

 SPECIFIC DEPRECIABLE ASSETS USED IN ALL BUSINESS ACTIVITIES, EXCEPT

 

   AS NOTED:

 

 

 00.11 OFFICE FURNITURE, FIXTURES

 

       AND EQUIPMENT:

 

 

       Includes furniture and fixtures that

 

       are not a structural component of a

 

       building. Includes such assets as

 

       desks, files, safes, and

 

       communications equipment. Does not

 

       include communications equipment

 

       that is included in other classes    10       7         10

 

 

 00.12 INFORMATION SYSTEMS:

 

 

       Includes computers and their

 

       peripheral equipment used in

 

       administering normal business

 

       transactions and the maintenance of

 

       business records, their retrieval

 

       and analysis.

 

 

       Information systems are defined as:

 

 

       1) Computers: A computer is a

 

       programmable electronically

 

       activated device capable of

 

       accepting information, applying

 

       prescribed processes to the

 

       information, and supplying the

 

       results of these processes with or

 

       without human intervention. It

 

       usually consists of a central

 

       processing unit containing extensive

 

       storage, logic, arithmetic, and

 

       control capabilities. Excluded from

 

       this category are adding machines,

 

       electronic desk calculators, etc.

 

       and other equipment described in

 

       class 00.13

 

 

       2) Peripheral equipment consists of

 

       the auxiliary machines which are

 

       designed to be placed under control

 

       of the central processing unit.

 

       Nonlimiting examples are: Card

 

       readers, card punches, magnetic tape

 

       fees, high speed printers, optical

 

       character readers, tape cassettes,

 

       mass storage units, paper tape

 

       equipment, keypunches, data entry

 

       devices, teleprinters, terminals,

 

       tape drives, disc drives, disc

 

       files, disc packs, visual image

 

       projector tubes, card sorters,

 

       plotters, and collators. Peripheral

 

       equipment may be used on-line or off-

 

       line.

 

 

       Does not include equipment that is

 

       an integral part of other capital

 

       equipment that is included in other

 

       classes of economic activity, i.e.,

 

       computers used primarily for process

 

       or production control, switching,

 

       channeling, and automating

 

       distributive trades and services

 

       such as point of sale (POS) computer

 

       systems. Also, does not include

 

       equipment of a kind used primarily

 

       for amusement or entertainment of

 

       the user                              6      5 1       5 1

 

 

 00.13 DATA HANDLING EQUIPMENT, EXCEPT

 

       COMPUTERS:

 

 

       Includes only typewriters,

 

       calculators, adding and accounting

 

       machines, copiers, and duplicating

 

       equipment                             6       5          6

 

 

 00.21 AIRPLANES (AIRFRAMES AND ENGINES),

 

       EXCEPT THOSE USED IN COMMERCIAL OR

 

       CONTRACT CARRYING OF PASSENGERS OR

 

       FREIGHT, AND ALL HELICOPTERS

 

       (AIRFRAMES AND ENGINES)               6       5          6

 

 

 00.22 AUTOMOBILES, TAXIS                    3       5          5

 

 

 00.23 BUSES                                 9       5          9

 

 

 00.241 LIGHT GENERAL PURPOSE TRUCKS:

 

 

       Includes trucks for use over the

 

       road (actual unloaded weight less

 

       than 13,000 pounds)                   4       5          5

 

 

 00.242 HEAVY GENERAL PURPOSE TRUCKS:

 

 

       Includes heavy general purpose

 

       trucks, concrete ready mix-

 

       truckers, and ore trucks, for use

 

       over the road (actual unloaded

 

       weight 13,000 pounds or more)         6       5          6

 

 

 00.25 RAILROAD CARS AND LOCOMOTIVES,

 

       EXCEPT THOSE OWNED BY RAILROAD

 

       TRANSPORTATION COMPANIES             15       7         15

 

 

 00.26 TRACTOR UNITS FOR USE OVER-THE-

 

       ROAD                                  4       3          4

 

 

 00.27 TRAILERS AND TRAILER-MOUNTED

 

       CONTAINERS                            6       5          6

 

 

 00.28 VESSELS, BARGES, TUGS, AND SIMILAR

 

       WATER TRANSPORTATION EQUIPMENT,

 

       EXCEPT THOSE USED IN MARINE

 

       CONSTRUCTION                         18      10         18

 

 

 00.3  LAND IMPROVEMENTS:

 

 

       Includes improvements directly to

 

       or added to land, whether such

 

       improvements are section 1245

 

       property or section 1250 property,

 

       provided such improvements are

 

       depreciable. Examples of such

 

       assets might include sidewalks,

 

       roads, canals, waterways, drainage

 

       facilities, sewers (not including

 

       municipal sewers in Class 51),

 

       wharves and docks, bridges,

 

       fences, landscaping, shubbery, or

 

       radio and television transmitting

 

       towers. Does not include land

 

       improvements that are explicitly

 

       included in any other class, and

 

       buildings and structural

 

       components as defined in section

 

       1.48-1(e) of the regulations.

 

       Excludes public utility initial

 

       clearing and grading land

 

       improvements as specified in Rev.

 

       Rul. 72-403, 1972-2 C.B. 102         20      15         20

 

 

 00.4  INDUSTRIAL STEAM AND ELECTRIC

 

       GENERATION AND/OR DISTRIBUTION

 

       SYSTEMS:

 

 

       Includes assets, whether such

 

       assets are section 1245 property

 

       or 1250 property, providing such

 

       assets are depreciable, used in

 

       the production and/or distribution

 

       of electricty with rated total

 

       capacity in excess of 500

 

       Kilowatts and/or assets used in

 

       the production and/or distribution

 

       of steam with rated total capacity

 

       in excess of 12,500 pounds per

 

       hour for use by the taxpayer in

 

       its industrial manufacturing

 

       process or plant activity and not

 

       ordinarily available for sale to

 

       others. Does not include buildings

 

       and structural components as

 

       defined in section 1.48-1(e) of

 

       the regulations. Assets used to

 

       generate and/or distribute

 

       electricity or steam of the type

 

       described above but of lesser

 

       rated capacity are not included,

 

       but are included in the

 

       appropriate manufacturing

 

       equipment classes elsewhere

 

       specified. Also includes electric

 

       generating and steam distribution

 

       assets, which may utilize steam

 

       produced by a waste reduction and

 

       resource recovery plan, used by

 

       the taxpayer in its industrial

 

       manufacturing process or plant

 

       activity. Steam and chemical

 

       recovery boiler systems used for

 

       the recovery and regeneration of

 

       chemicals used in manufacturing,

 

       with rated capacity in excess of

 

       that described above, with

 

 

       specifically related distribution

 

       and return systems are not

 

       included but are included in

 

       appropriate manufacturing

 

       equipment classes elsewhere

 

       specified. An example of an

 

       excluded steam and chemical

 

       recovery boiler system is that

 

       used in the pulp and paper

 

       manufacturing industry               22      15         22

 

 

                                                Recovery Periods

 

                                                   (in years)

 

 

                                          Class  General  Alternative

 

                                           Life   Depre-     Depre-

 

 Asset                                     (in    ciation   ciation

 

 class  Description of assets included    years)  System     System

 

 _____  ______________________________    ______  _______  ___________

 

 

 DEPRECIABLE ASSETS USED IN THE FOLLOWING ACTIVITIES:

 

 

 01.1  AGRICULTURE:

 

 

       Includes machinery and equipment,

 

       grain bins, and fences but no

 

       other land improvements, that are

 

       used in the production of crops

 

       or plants, vines, and trees;

 

       livestock; the operation of farm

 

       dairies, nurseries, greenhouses,

 

       sod farms, mushroom cellars,

 

       cranberry bogs, apiaries, and fur

 

       farms; the performance of

 

       agriculture, animal husbandry, and

 

       horticultural services               10       7         10

 

 

 01.11 COTTON GINNING ASSETS                12       7         12

 

 

 01.21 CATTLE, BREEDING OR DAIRY             7       5          7

 

 

 01.22 HORSES, BREEDING OR WORK             10       7         10

 

 

 01.221 ANY HORSE THAT IS NOT A RACE

 

        HORSE AND THAT IS MORE THAN

 

        12 YEARS OLD AT THE TIME IT

 

        IS PLACED IN SERVICE                10       3         10

 

 

 01.222 ANY RACE HORSE THAT IS MORE

 

        THAN 2 YEARS OLD AT THE TIME

 

        IT IS PLACED IN SERVICE             2      3         12

 

 

 01.23 HOGS, BREEDING                        3       3          3

 

 

 01.24 SHEEP AND GOATS, BREEDING             5       5          5

 

 

 01.3  FARM BUILDING EXCEPT STRUCTURES

 

       INCLUDED IN CLASS 01.4               25      20         25

 

 

 01.4  SINGLE PURPOSE AGRICULTURAL OR

 

       HORTICULTURAL STRUCTURES (WITHIN

 

       THE MEANING OF SECTION 48(p) OF THE

 

       CODE)                                15       7         15

 

 

 10.0  MINING:

 

 

       Includes assets used in the mining

 

       and quarrying of metallic and

 

       nonmetallic minerals (including

 

       sand, gravel, stone, and clay) and

 

       the milling, beneficiation and

 

       other primary preparation of such

 

       materials                            10       7         10

 

 

 13.0  OFFSHORE DRILLING:

 

 

       Including assets used in offshore

 

       drilling for oil and gas such as

 

       floating, self-propelled and other

 

       drilling vessels, barges,

 

       platforms, and drilling equipment

 

       and support vessels such as

 

       tenders, barges, towboats and

 

       crewboats. Excludes oil and gas

 

       production assets                    7.5      5         7.5

 

 

 13.1  DRILLING OF OIL AND GAS WELLS:

 

 

       Includes assets used in the

 

       drilling of onshore oil and gas

 

       wells and the provision of

 

       geophysical and other exploration

 

       services; and the provision of

 

       such oil and gas field services as

 

       chemical treatment, plugging and

 

       abandoning of wells and cementing

 

       or perforating well casings. Does

 

       not include assets used in the

 

       performance of any of these

 

       activities and services by

 

 

       integrated petroleum and natural

 

       gas producers for their own

 

       account                               6       5          6

 

 

 13.2  EXPLORATION FOR AND PRODUCTION OF

 

       PETROLEUM AND NATURAL GAS

 

       DEPOSITS:

 

 

       Includes assets used by petroleum

 

       and natural gas producers for

 

       drilling of wells and production

 

       of petroleum and natural gas,

 

       including gathering pipelines and

 

       related storage facilities. Also

 

       includes petroleum and natural gas

 

       offshore transportation facilities

 

       used by producers and others

 

       consisting of platforms (other

 

       than drilling platforms classified

 

       in Class 13.0), compression or

 

       pumping equipment, and gathering

 

       and transmission lines to the

 

       first onshore transshipment

 

       facility. The assets used in the

 

       first onshore transshipment

 

       facility are also included and

 

       consist of separation equipment

 

       (used for separation of natural

 

       gas, liquids, and solids),

 

       compression or pumping equipment

 

       (other than equipment classified

 

       in Class 49.23), and liquid

 

       holding or storage facilities

 

       (other than those classified in

 

       Class 49.25). Does not include

 

       support vessels                      14       7         14

 

 

 13.3  PETROLEUM REFINING:

 

 

       Includes assets used for the

 

       distillation, fractionation, and

 

       catalytic cracking of crude

 

       petroleum into gasoline and its

 

       other components                     16      10         16

 

 

 15.0  CONSTRUCTION:

 

 

       Includes assets used in

 

       construction by general building,

 

       special trade, heavy and marine

 

       construction contractors,

 

       operative and investment builders,

 

       real estate subdividers and

 

       developers, and others except

 

       railroads                             6       5          6

 

 

 20.1  MANUFACTURE OF GRAIN AND GRAIN MILL

 

       PRODUCTS:

 

 

       Includes assets used in the

 

       production of flours, cereals,

 

       livestock fees, and other grain

 

       and grain mill products              17      10         17

 

 

 20.2  MANUFACTURE OF SUGAR AND SUGAR

 

       PRODUCTS:

 

 

       Includes assets used in the

 

       production of raw sugar, syrup, or

 

       finished sugar from sugar cane or

 

       sugar beets                          18      10         18

 

 

 20.3  MANUFACTURE OF VEGETABLE OILS AND

 

       VEGETABLE OIL PRODUCTS:

 

 

       Includes assets used in the

 

       production of oil from vegetable

 

       materials and the manufacture of

 

       related vegetable oil products       18      10         18

 

 

 20.4  MANUFACTURE OF OTHER FOOD AND

 

       KINDRED PRODUCTS:

 

 

       Includes assets used in the

 

       production of foods and beverages

 

       not included in classes 20.1, 20.2

 

       and 20.3                             12       7         12

 

 

 20.5  MANUFACTURE OF FOOD AND BEVERAGES --

 

       SPECIAL HANDLING DEVICES:

 

 

       Includes assets defined as

 

       specialized materials handling

 

       devices such as returnable

 

       pallets, palletized containers,

 

       and fish processing equipment

 

       including boxes, baskets, carts,

 

       and flaking trays used in

 

       activities as defined in classes

 

       20.1, 20.2, 20.3 and 20.4. Does

 

 

       not include general purpose small

 

       tools such as wrenches and drills,

 

       both hand and power-driven, and

 

       other general purpose equipment

 

       such as conveyors, transfer

 

       equipment, and materials handling

 

       devices                               4       3          4

 

 

 21.0  MANUFACTURE OF TOBACCO AND TOBACCO

 

       PRODUCTS:

 

 

       Includes assets used in the

 

       production of cigarettes, cigars,

 

       smoking and chewing tobacco,

 

       snuff, and other tobacco products    15       7         15

 

 

 22.1  MANUFACTURE OF KNITTED GOODS:

 

 

       Includes assets used in the

 

       production of knitted and netted

 

       fabrics and lace. Assets used in

 

       yarn preparation, bleaching,

 

       dyeing, printing, and other

 

       similar finishing processes,

 

       texturing, and packaging, are

 

       elsewhere classified.                7.5      5         7.5

 

 

 22.2  MANUFACTURE OF YARN, THREAD, AND

 

       WOVEN FABRIC:

 

 

       Includes assets used in the

 

       production of spun yarns including

 

       the preparing, blending,

 

       spinning, and twisting of fibers

 

       into yarns and threads, the

 

       preparation of yarns such as

 

       twisting, warping, and winding,

 

       the production of covered elastic

 

       yarn and thread, cordage, woven

 

       fabric, tire fabric, braided

 

       fabric, twisted jute for

 

       packaging, mattresses, pads,

 

       sheets, and industrial belts, and

 

       the processing of textile mill

 

       waste to recover fibers, flocks,

 

       and shoddies. Assets used to

 

       manufacture carpets, man-made

 

       fibers, and nonwovens, and assets

 

       used in texturing, bleaching,

 

       dyeing, printing, and other

 

       similar finishing processes, are

 

       elsewhere classified                 11       7         11

 

 

 22.3  MANUFACTURE OF CARPETS, AND

 

       DYEING, FINISHING, AND PACKAGING

 

       OF TEXTILE PRODUCTS AND

 

       MANUFACTURE OF MEDICAL AND DENTAL

 

       SUPPLIES:

 

 

       Includes assets used in the

 

       production of carpets, rugs, mats,

 

       woven carpet backing, chenille, and

 

       and other tufted products, and

 

       assets used in the joining together

 

       of backing with carpet yarn or fabric.

 

       Includes assets used in washing,

 

       scouring, bleaching, dyeing, printing,

 

       drying, and similar finishing processes

 

       applied to textile fabrics, yarns,

 

       threads, and other textile products,

 

       other than apparel, by ceasing,

 

       forming, trimming, cutting, and sewing,

 

       such as the preparation of carpet and

 

       fabric samples, or similar joining

 

       together processes (other than the

 

       preparation of scrim reinforced paper

 

       products and laminated paper products),

 

       such as the sewing and folding of

 

       hosiery and panty hose, and creasing,

 

       folding, trimming, and cutting of

 

       fabrics to produce nonwoven products,

 

       such as disposable diapers and sanitary

 

       products. Also includes assets used in

 

       the production of medical and dental

 

       supplies other than drugs and medicines.

 

       Assets used in the manufacture of

 

       nonwoven carpet backing, and hard

 

       surface floor covering, such as tile,

 

       rubber, and cork, are elsewhere

 

       classified.                           9       5          9

 

 

 22.4  MANUFACTURE OF TEXTURED YARNS:

 

 

       Includes assets used in the

 

       processing of yarns to impart bulk

 

       and/or stretch properties to the

 

       yarn. The principal machines

 

       involved are falsetwist, draw,

 

       beam-to-beam, and stuffer box

 

       texturing equipment and related

 

 

       highspeed twisters and winders.

 

       Assets, as described above, which

 

       are used to further process man-

 

       made fibers are elsewhere

 

       classified when located in the

 

       same plant in an integrated

 

       operation with man-made fiber

 

       producing assets. Assets used to

 

       manufacture man-made fibers and

 

       assets used in bleaching, dyeing,

 

       printing, and other similar

 

       finishing processes, are elsewhere

 

       classifed                             8       5          8

 

 

 22.5  MANUFACTURE OF NONWOVEN FABRICS:

 

 

       Includes assets used in the

 

       production of nonwoven fabrics,

 

       felt goods including felt hats,

 

       padding, batting, wadding, oakum,

 

       and fillings, from new materials

 

       and from textile mill waste.

 

       Nonwoven fabrics are defined as

 

       fabrics (other than reinforced and

 

       laminated composites consisting of

 

       nonwovens and other products)

 

       manufactured by bonding natural

 

       and/or synthetic fibers and/or

 

       filaments by means of induced

 

       mechanical interlocking, fluid

 

       entanglement, chemical adhesion,

 

       thermal or solvent reaction, or by

 

       combination thereof other than

 

       natural hydration bonding as

 

       occurs with natural cellulose

 

       fibers. Such means include resin

 

       bonding, web bonding, and melt

 

       bonding. Specifically includes

 

       assets used to make flocked and

 

       needle punched products other than

 

       carpets and rugs. Assets, as

 

       described above, which are used to

 

       manufacture nonwovens are

 

       elsewhere classified when located

 

       in the same plant in an integrated

 

       operation with man-made fiber

 

       producing assets. Assets used to

 

       manufacture man-made fibers and

 

       assets used in bleaching, dyeing,

 

       printing, and other similar

 

       finishing processes, are elsewhere

 

       classified.                          10       7         10

 

 

 23.0  MANUFACTURE OF APPAREL AND OTHER

 

       FINISHED PRODUCTS:

 

 

       Includes assets used in the

 

       production of clothing and

 

       fabricated textile products by the

 

       cutting and sewing of woven

 

       fabrics, other textile products,

 

       and furs; but does not include

 

       assets used in the manufacture of

 

       apparel from rubber and leather       9       5          9

 

 

 24.1  CUTTING OF TIMBER:

 

 

       Includes logging machinery and

 

       equipment and roadbuilding

 

       equipment used by logging and

 

       sawmill operators and pulp

 

       manufacturers for their own

 

       account                               6       5          6

 

 

 24.2  SAWING OF DIMENSIONAL STOCK FROM

 

       LOGS:

 

 

       Includes machinery and equipment

 

       installed in permanent or well

 

       established sawmills                 10       7         10

 

 

 24.3  SAWING OF DIMENSIONAL STOCK FROM

 

       LOGS:

 

 

       Includes machinery and equipment

 

       installed in sawmills

 

       characterized by temporary

 

       foundations and a lack, or minimum

 

       amount, of lumber handling, drying,

 

       and residue disposal equipment and

 

       facilities                            6       5          6

 

 

 24.4  MANUFACTURE OF WOOD PRODUCTS, AND

 

       FURNITURE:

 

 

       Includes assets used in the

 

       production of plywood, hardboard,

 

       flooring, veneers, furniture, and

 

       other wood products, including the

 

       treatment of poles and timber        10       7         10

 

 

 26.1  MANUFACTURE OF PULP AND PAPER:

 

 

       Includes assets for pulp materials

 

       handling and storage, pulp mill

 

       processing, bleach processing,

 

       paper and paperboard

 

       manufacturing, and on-line

 

       finishing. Includes pollution

 

       control assets and all land

 

       improvements associated with the

 

       factory site or production process

 

       such as effluent ponds and canals,

 

       provided such improvements are

 

       depreciable but does not include

 

       building and structural components

 

       as defined in section 1.48-1(e)(1)

 

       of the regulations. Includes steam

 

       and chemical recovery boiler

 

       systems, with any rated capacity,

 

       used for the recovery and

 

       regeneration of chemicals used in

 

       manufacturing. Does not include

 

       assets used either in pulpwood

 

       logging, or in the manufacture or

 

       hardboard.                           13       7         13

 

 

 26.2  MANUFACTURE OF CONVERTED PAPER,

 

       PAPERBOARD, AND PULP PRODUCTS:

 

 

       Includes assets used for

 

       modification, or remanufacture of

 

       paper and pulp into converted

 

       products, such as paper coated off

 

       the paper machine, paper bags,

 

       paper boxes, cartons and

 

       envelopes. Does not include assets

 

       used for manufacture of nonwovens

 

       that are elsewhere classified        10       7         10

 

 

 27.0  PRINTING, PUBLISHING, AND ALLIED

 

       INDUSTRIES:

 

 

       Includes assets used in printing

 

       by one or more processes, such as

 

       letter-press, lithography,

 

       gravure, or screen; the

 

       performance of services for the

 

       printing trade, such as

 

       bookbinding, typesetting,

 

       engraving, photo-engraving, and

 

       electrotyping; and the publication

 

       of newspapers, books and

 

       periodicals                          11       7         11

 

 

 28.0  MANUFACTURE OF CHEMICALS AND

 

       ALLIED PRODUCTS:

 

 

       Includes assets used to

 

       manufacture basic organic and

 

       inorganic chemicals; chemical

 

       products to be used in further

 

       manufacture, such as synthetic

 

       fibers and plastics materials; and

 

       finished chemical products.

 

       Includes assets used to further

 

       process man-made fibers, to

 

       manufacture plastic film, and to

 

       manufacture nonwoven fabrics, when

 

       such assets are located in the

 

       same plant in an integrated

 

       operation with chemical products

 

       producing assets. Also includes

 

       assets used to manufacture

 

       photographic supplies, such as

 

       film, photographic paper,

 

       sensitized photographic paper, and

 

       developing chemicals. Includes all

 

       land improvements associated with

 

       plant site or production

 

       processes, such as effluent ponds

 

       and canals, provided such land

 

       improvements are depreciable but

 

       does not include building and

 

       structural components as defined

 

       in section 1.48-1(e) of the

 

       regulations. Does not include

 

       assets used in the manufacture of

 

       finished rubber and plastic

 

       products or in the production of

 

       natural gas products, butane,

 

       propane, and by-products of

 

       natural gas production plants        9.5      5         9.5

 

 

 30.1  MANUFACTURE OF RUBBER PRODUCTS:

 

 

       Includes assets used for the

 

       production of products from

 

       natural, synthetic, or reclaimed

 

       rubber, gutta percha, balata, or

 

 

       gutta siak, such as tires, tubes,

 

       rubber sundries; and in the

 

       recapping, retreading, and

 

       rebuilding of tires                  14       7         14

 

 

 30.11 MANUFACTURE OF RUBBER PRODUCTS --

 

       SPECIAL TOOLS AND DEVICES:

 

 

       Includes assets defined as special

 

       tools, such as jigs, dies,

 

       mandrels, molds, lasts, patterns,

 

       specialty containers, pallets,

 

       shells; and tire molds, and

 

       accessory parts such as rings and

 

       insert plates used in activities

 

       as defined in class 30.1. Does not

 

       include tire building drums and

 

       accessory parts and general

 

       purpose small tools such as

 

       wrenches and drills, both power

 

       and hand-driven, and other general

 

       purpose equipment such as

 

       conveyors and transfer equipment      4       3          4

 

 

 30.2  MANUFACTURE OF FINISHED PLASTIC

 

       PRODUCTS:

 

 

       Includes assets used in the

 

       manufacture of plastics products

 

       and the molding of primary

 

       plastics for the trade. Does not

 

       include assets used in the

 

       manufacture of basic plastics

 

       materials nor the manufacture of

 

       phonograph records                   11       7         11

 

 

 30.21 MANUFACTURE OF FINISHED PLASTIC

 

       PRODUCTS -- SPECIAL TOOLS:

 

 

       Includes assets defined as special

 

       tools, such as jigs, dies,

 

       fixtures, molds, patterns, gauges,

 

       and specialty transfer and

 

       shipping devices, used in

 

       activities as defined in class

 

       30.2. Special tools are

 

       specifically designed for the

 

       production or processing of

 

       particular parts and have no

 

       significant; utilitarian value and

 

       cannot be adapted to further or

 

       different use after changes or

 

       improvements are made in the model

 

       design of the particular part

 

       produced by the special tools. Does

 

       not include general purpose small

 

       tools such as wrenches and drills,

 

       both hand and power-driven, and

 

       other general purpose equipment such

 

       as conveyors, transfer equipment, and

 

       materials handling devices            3.5    3           3.5

 

 

 31.0  MANUFACTURE OF LEATHER AND LEATHER

 

       PRODUCTS:

 

 

       Includes assets used in the tanning,

 

       currying, and finishing of hides and

 

       skins; the processing of fur pelts;

 

       and the manufacture of finished

 

       leather products, such as footwear,

 

       belting, apparel, and luggage        11      7          11

 

 

 32.1  MANUFACTURE OF GLASS PRODUCTS:

 

 

       Includes assets used in the

 

       production of flat, brown, or

 

       pressed products of glass, such as

 

       float and window glass, glass

 

       containers, glassware and

 

       fiberglass. Does not include assets

 

       used in the manufacture of lenses    14      7          14

 

 

 32.11 MANUFACTURE OF GLASS PRODUCTS --

 

       SPECIAL TOOLS:

 

 

       Includes assets defined as special

 

       tools such as molds, patterns,

 

       pallets, and specialty transfer and

 

       shipping devices such as steel racks

 

       to transport automotive glass, used

 

       in activities as defined in class

 

       32.1. Special tools are specifically

 

       designed for the production or

 

       processing of particular parts and

 

       have no significant utilitarian

 

       value and cannot be adapted to

 

       further or different use after

 

       changes or improvements are made in

 

       the model design of the particular

 

       part produced by the special tools.

 

 

       Does not include general purpose

 

       small tools such as wrenches and

 

       drills, both hand and power-driven,

 

       and other general purpose equipment

 

       such as conveyors, transfer

 

       equipment, and materials handling

 

       devices                               2.5    3           2.5

 

 

 32.2  MANUFACTURE OF CEMENT:

 

 

       Includes assets used in the

 

       production of cement, but does not

 

       include any assets used in the

 

       manufacture of concrete and concrete

 

       products nor in any mining or

 

       extraction process                   20      15         20

 

 

 32.3  MANUFACTURE OF OTHER STONE AND CLAY

 

       PRODUCTS:

 

 

       Includes assets used in the

 

       manufacture of products from

 

       materials in the form of clay and

 

       stone, such as brick, tile, and

 

       pipe; pottery and related products,

 

       such as vitreous-china, plumbing

 

       fixtures, earthenware and ceramic

 

       insulating materials; and also

 

       includes assets used in manufacture

 

       of concrete and concrete products.

 

       Does not include assets used in any

 

       mining or extraction processes       15      7          15

 

 

 33.2  MANUFACTURE OF PRIMARY NONFERROUS

 

       METALS:

 

 

       Includes assets used in the smelting,

 

       refining, and electrolysis of

 

       nonferrous metals from ore, pig, or

 

       scrap, the rolling, drawing, and

 

       alloying of nonferrous metals; the

 

       manufacture of castings, forgings,

 

       and other basic products of

 

       nonferrous metals; and the

 

       manufacture of nails, spikes,

 

       structural shapes, tubing, wire, and

 

       cable                                14      7          14

 

 

 33.21 MANUFACTURE OF PRIMARY NONFERROUS

 

       METALS -- SPECIAL TOOLS:

 

 

       Includes assets defined as special

 

       tools such as dies, jigs, molds,

 

       patterns, fixtures, gauges, and

 

       drawings concerning such special

 

       tools used in the activities as

 

       defined in class 33.2, Manufacture

 

       of Primary Nonferrous Metals.

 

       Special tools are specifically

 

       designed for the production or

 

       processing of particular products or

 

       parts and have no significant

 

       utilitarian value and cannot be

 

       adapted to further or different use

 

       after changes or improvements are

 

       made in the model design of the

 

       particular part produced by the

 

       special tools. Does not include

 

       general purpose small tools such as

 

       wrenches and drills, both hand and

 

       power-driven, and other general

 

       purpose equipment such as conveyors,

 

       transfer equipment, and materials

 

       handling devices. Roll, mandrels and

 

       refractories are not included in

 

       class 33.21 but are included in

 

       class 33.2                            6.5    5           6.5

 

 

 33.3  MANUFACTURE OF FOUNDRY PRODUCTS:

 

 

       Includes assets used in the casting

 

       of iron and steel, including related

 

       operations such as molding and

 

       coremaking. Also includes assets

 

       used in the finishing of castings

 

       and patternmaking when performed at

 

       the foundry, all special tools and

 

       related land improvements            14      7          14

 

 

 33.4  MANUFACTURE OF PRIMARY STEEL

 

       MILL PRODUCTS:

 

 

       Includes assets used in the

 

       smelting, reduction, and refining of

 

       iron and steel from ore, pig, or scrap;

 

       the rolling, drawing and alloying of

 

       steel; the manufacture of nails,

 

       spikes, structural shapes, tubing,

 

       wire, and cable. Includes assets

 

       used by steel service centers,

 

 

       ferrous metal forges, and assets

 

       used in coke production, regardless

 

       of ownership. Also includes related

 

       land improvements and all special

 

       tools used in the above activities   15      7          15

 

 

 34.0  MANUFACTURE OF FABRICATED METAL

 

       PRODUCTS:

 

 

       Include assets used in the

 

       production of metal cans, tinware,

 

       fabricated structural metal

 

       products, metal stampings, and other

 

       ferrous and nonferrous metal and

 

       wire products not elsewhere

 

       classified. Does not include assets

 

       used to manufacture non-electric

 

       heating apparatus                    12      7          12

 

 

 34.01 MANUFACTURE OF FABRICATED METAL

 

       PRODUCTS -- SPECIAL TOOLS:

 

 

       Includes assets defined as special

 

       tools such as dies, jigs, molds,

 

       patterns, fixtures, gauges, and

 

       returnable containers and drawings

 

       concerning such special tools used

 

       in the activities as defined in

 

       class 34.0. Special tools are

 

       specifically designed for the

 

       production or processing of

 

       particular machine components,

 

       products, or parts, and have no

 

       significant utilitarian value and

 

       cannot be adapted to further or

 

       different use after changes or

 

       improvements are made in the model

 

       design of the particular part

 

       produced by the special tools. Does

 

       not include general purpose small

 

       tools such as wrenches and drills,

 

       both hand and power-driven, and

 

       other general purpose equipment such

 

       as conveyors, transfer equipment,

 

       and material handling devices         3      3           3

 

 

 35.0  MANUFACTURE OF ELECTRICAL AND NON-

 

       ELECTRICAL MACHINERY AND

 

       OTHER MECHANICAL PRODUCTS:

 

 

       Includes assets used to manufacture

 

       or rebuild finished machinery and

 

       equipment and replacement parts

 

       thereof such as machine tools,

 

       general industrial and special

 

       industry machinery, electrical power

 

       generation, transmission, and

 

       distribution systems, space heating,

 

       cooling, and refrigeration systems,

 

       commercial and home appliances, farm

 

       and garden machinery, construction

 

       machinery, mining and oil field

 

       machinery, internal combustion

 

       engines (except those elsewhere

 

       classified), turbines (except those

 

       that power airborne vehicles)

 

       batteries, lamps and lighting

 

       fixtures, carbon and graphite

 

       products, and electromechanical and

 

       mechanical products including

 

       business machines, instruments,

 

       watches and clocks, vending and

 

       amusement machines, photographic

 

       equipment, medical and dental

 

       equipment and appliances, and

 

       ophthalmic goods. Includes assets

 

       used by manufacturers or rebuilders

 

       of such finished machinery and

 

       equipment in activities elsewhere

 

       classified such as the manufacture

 

       of castings, forgings, rubber and

 

       plastic products, electronic

 

       subassemblies or other manufacturing

 

       activities if the interim products

 

       are used by the same manufacturer

 

       primarily in the manufacture,

 

       assembly, or rebuilding of such

 

       finished machinery and equipment.

 

       Does not include assets used in

 

       mining, assets used in the

 

       manufacture of primary ferrous and

 

       nonferrous metals, assets included

 

       in class 00.11 through 00.4 and

 

       assets elsewhere classified          10      7          10

 

 

 36.0  MANUFACTURE OF ELECTRONIC

 

       COMPONENTS, PRODUCTS, AND SYSTEMS:

 

 

       Include assets used in the

 

       manufacture of electronic

 

 

       communication, computation,

 

       instrumentation and control system,

 

       including airborne products such as

 

       frequency and amplitude modulated

 

       transmitters and receivers,

 

       electronic switching stations,

 

       television cameras, video recorders,

 

       record players and tape recorders,

 

       computers and computer peripheral

 

       machines, and electronic

 

       instruments, watches, and clocks;

 

       also includes assets used in the

 

       manufacture of components, provided

 

       their primary use is in products and

 

       systems defined above such as

 

       electron tubes, capacitors, coils,

 

       resistors, printed circuit

 

       substrates, switches, harness

 

       cables, lasers, fiber optic devices,

 

       and magnetic media devices.

 

       Specifically excludes assets used to

 

       manufacture electronic product, and

 

       componets, photocopiers,

 

       typewriters, postage meters and

 

       other electromechanical and

 

       mechanical business machines and

 

       instruments that are elsewhere

 

       classified. Does not include

 

       semiconductor manufacturing

 

       equipment included in class 36.1      6      5          6

 

 

 36.1  MANUFACTURE OF SEMICONDUCTORS:

 

 

       Includes equipment used in the

 

       manufacturing of semiconductors if

 

       the primary use of the

 

       semiconductors so produced is in

 

       products and systems of the type

 

       defined in class 36.0                 5      5           5

 

 

 37.11 MANUFACTURE OF MOTOR VEHICLES:

 

 

       Includes assets used in the

 

       manufacture and assembly of finished

 

       automobiles, trucks, trailers,

 

       motor homes, and buses. Does not

 

       include assets used in mining,

 

       printing and publishing, production

 

       of primary metals, electricity, or

 

       steam, or the manufacture of glass,

 

       industrial chemicals, batteries, or

 

       rubber products, which are

 

       classified elsewhere. Includes

 

       assets used in manufacturing

 

       activities elsewhere classified

 

       other than those excluded above,

 

       where such activities are incidental

 

       to and an integral part of the

 

       manufacture and assembly of finished

 

       metal products, electrical

 

       equipment, textiles, plastics,

 

       leather, and foundry and forging

 

       operations. Does not include any

 

       assets not classified in

 

       manufacturing activity classes,

 

       e.g., does not include assets

 

       classified in asset classes 00.11

 

       through 00.4. Activities will be

 

       considered incidental to the

 

       manufacture and assembly of finished

 

       motor vehicles. Parts that are

 

       produced as a normal replacement

 

       stock complement in connection with

 

       the manufacture and assembly of

 

       finished motor vehicles. Do not

 

       include assets used in the

 

       manufacture of component parts if

 

       these assets are used by taxpayers

 

       not engaged in the assembly of

 

       finished motor vehicles              12      7          12

 

 

 37.12 MANUFACTURE OF MOTOR VEHICLES --

 

       SPECIAL TOOLS:

 

 

       Includes assets defined as special

 

       tools, such as jigs, dies, fixtures,

 

       molds, patterns, gauges, and

 

       specialty transfer and shipping

 

       devices, owned by manufacturers of

 

       finished motor vehicles and used in

 

       qualified activities as defined in

 

       class 37.11. Special tools are

 

       specifically designed for the

 

       production or processing of

 

       particular motor vehicle components

 

       and have no significant utilitarian

 

       value, and cannot be adapted to

 

       further or different use, after

 

       changes or improvements are made in

 

       the model design of the particular

 

 

       part produced by the special tools.

 

       Does not include general purpose

 

       small tools such as wrenches and

 

       drills, both hand and powerdriven,

 

       and other general purpose equipment

 

       such as conveyors, transfer

 

       equipment, and materials handling

 

       devices                               3      3           3

 

 

 37.2  MANUFACTURE OF AEROSPACE PRODUCTS:

 

 

       Includes assets used in the

 

       manufacture and assembly of airborne

 

       vehicles and their component parts

 

       including hydraulic, pneumatic,

 

       electrical, and mechanical systems.

 

       Does not include assets used in the

 

       production of electronic airborne

 

       detection, guidance, control,

 

       radiation, computation, test,

 

       navigation, and communication

 

       equipment or the components thereof  10      7          10

 

 

 37.31 SHIP AND BOAT BUILDING MACHINERY AND

 

       EQUIPMENT:

 

 

       Includes assets used in the

 

       manufacture and repair of ships,

 

       boats, caissons, marine drilling

 

       rigs, and special fabrications not

 

       included in asset classes 37.32 and

 

       37.33. Specifically includes all

 

       manufacturing and repairing

 

       machinery and equipment, including

 

       machinery and equipment used in the

 

       operation of assets included in

 

       asset class 37.32. Excludes

 

       buildings and their structural

 

       components                           12      7          12

 

 

 37.32 SHIP AND BOAT BUILDING DRY DOCKS AND

 

       LAND IMPROVEMENTS:

 

 

       Includes assets used in the

 

       manufacture and repair of ships,

 

       boats, caissons, marine drilling

 

       rigs, and special fabrications not

 

       included in asset classes 37.31 and

 

       37.33. Specifically includes

 

       floating and fixed dry docks, ship

 

       basins, graving docks, shipways,

 

       piers, and all other land

 

       improvements such as water, sewer,

 

       and electric systems. Excludes

 

       buildings and their structural

 

       components                           16      10         16

 

 

 37.33 SHIP AND BOAT BUILDING -- SPECIAL

 

       TOOLS:

 

 

       Includes assets defined as special

 

       tools such as dies, jigs, molds,

 

       patterns fixtures, gauges, and

 

       drawings concerning such special

 

       tools used in the activities defined

 

       in classes 37.31 and 37.32. Special

 

       tools are specifically designed for

 

       the production or processing of

 

       particular machine components,

 

       products, or parts, and have no

 

       significant utilitarian value and

 

       cannot be adapted to further or

 

       different use after changes or

 

       improvements are made in the model

 

       design of the particular part

 

       produced by the special tools. Does

 

       not include general purpose small

 

       tools such as wrenches and drills,

 

       both hand and power-driven, and

 

       other general purpose equipment such

 

       as conveyors, transfer equipment,

 

       and materials handling devices        6.5    5           6.5

 

 

 37.41 MANUFACTURE OF LOCOMOTIVES:

 

 

       Includes assets used in building or

 

       rebuilding railroad locomotives

 

       (including mining and industrial

 

       locomotives). Does not include

 

       assets of railroad transportation

 

       companies or assets of companies

 

       which manufacture components of

 

       locomotives but do not manufacture

 

       finished locomotives.                11.5    7          11.5

 

 

 37.42 MANUFACTURE OF RAILROAD CARS:

 

 

       Includes assets used in building or

 

       rebuilding railroad freight or

 

       passenger cars (including rail

 

 

       transit cars). Does not include

 

       assets of railroad transportation

 

       companies or assets of companies

 

       which manufacture components of

 

       railroad cars but do not manufacture

 

       finished railroad cars               12      7          12

 

 

 39.0  MANUFACTURE OF ATHLETIC, JEWELRY AND

 

       OTHER GOODS:

 

 

       Includes assets used in the

 

       production of jewelry; musical

 

       instruments; toys and sporting

 

       goods; motion picture and television

 

       films and tapes; and pens, pencil,

 

       office and art supplies, brooms,

 

       brushes, caskets, etc.               12      7          12

 

 

       RAILROAD TRANSPORTATION:

 

 

       Classes with the prefix 40 include

 

       the assets identified below that are

 

       used in the commercial and contract

 

       carrying of passengers and freight

 

       by rail. Assets of electrified

 

       railroads will be classified in a

 

       manner corresponding to that set

 

       forth below for railroads not

 

       independently operated as electric

 

       lines. Excludes the assets included

 

       in classes with the prefix beginning

 

       00.1 and 00.2 above, and also

 

       excludes any non-depreciable assets

 

       included in Interstate Commerce

 

       Commission accounts enumerated for

 

       this class.

 

 

 40.1  RAILROAD MACHINERY AND EQUIPMENT:

 

 

       Includes assets classified in the

 

       following Interstate Commerce

 

       Commission accounts:

 

 

       ROADWAY ACCOUNTS:

 

 

       (16) Station and office building

 

         (freight handling machinery and

 

         equipment only)

 

       (25) TOFC/COFC terminals (freight

 

         handling machinery and equipment

 

         only)

 

       (26) Communication systems

 

       (27) Signals and interlockers

 

       (37) Roadway machines

 

       (44) Shop machinery

 

 

       EQUIPMENT ACCOUNTS:

 

       (52) Locomotives

 

       (53) Freight train cars

 

       (54) Passenger train cars

 

       (57) Work equipment                  14      7          14

 

 

 40.2  RAILROAD STRUCTURES AND SIMILAR

 

       IMPROVEMENTS:

 

 

       Includes assets classified in the

 

       following Interstate Commerce

 

       Commission road accounts:

 

 

        (6) Bridges, trestles, and culverts

 

        (7) Elevated structures

 

       (13) Fences, snowsheds, and signs

 

       (16) Station and office buildings

 

            (stations and other operating

 

            structures only)

 

       (17) Roadway buildings

 

       (18) Water stations

 

       (19) Fuel stations

 

       (20) Shops and enginehouses

 

       (25) TOFC/COFC terminals (operating

 

            structures only)

 

       (31) Power transmission systems

 

       (35) Miscellaneous structures

 

       (39) Public improvements

 

            construction                    30      20         30

 

 

 40.3  RAILROAD WHARVES AND DOCKS:

 

 

       Includes assets classified in the

 

       following Interstate Commerce

 

       accounts:

 

 

       (23) Wharves and docks

 

       (24) Coal and ore wharves            20      15         20

 

 

 40.4  RAILROAD TRACK                       10       7         10

 

 

 40.51 RAILROAD HYDRAULIC ELECTRIC

 

       GENERATING EQUIPMENT                 50      20         50

 

 

 40.52 RAILROAD NUCLEAR ELECTRIC GENERATING

 

       EQUIPMENT                            20      15         20

 

 

 40.53 RAILROAD STEAM ELECTRIC GENERATING

 

       EQUIPMENT                            28      20         28

 

 

 40.54 RAILROAD STEAM, COMPRESSED AIR, AND

 

       OTHER POWER PLANT EQUIPMENT          28      20         28

 

 

 41.0  MOTOR TRANSPORT-PASSENGERS:

 

 

       Includes assets used in the urban

 

       and interurban commercial and

 

       contract carrying of passengers by

 

       road, except the transportation

 

       assets included in classes with the

 

       prefix 00.2                           8       5          8

 

 

 42.0  MOTOR TRANSPORT-FREIGHT:

 

 

       Includes assets used in the

 

       commercial and contract carrying of

 

       freight by road, except the

 

       transportation assets included in

 

       classes with the prefix 00.2          8       5          8

 

 

 44.0  WATER TRANSPORTATION:

 

 

       Includes assets used in the

 

       commercial and contract carrying of

 

       freight and passengers by water

 

       except the transportation assets

 

       included in classes with the prefix

 

       00.2. Includes all related land

 

       improvements                         20      15         20

 

 

 45.0  AIR TRANSPORT:

 

 

       Includes assets (except helicopters)

 

       used in commercial and contract

 

       carrying of passengers and freight

 

       by air. For purposes of section

 

       1.167(a)-11(d)(2)(iv)(a) of the

 

       regulations, expenditures for

 

       "repair, maintenance,

 

       rehabilitation, or improvement"

 

       shall consist of direct maintenance

 

       expenses (irrespective of

 

       airworthiness provisions or charges)

 

       as defined by Civil Aeronautics

 

       Board uniform accounts 5200,

 

       maintenance burden (exclusive of

 

       expenses pertaining to maintenance

 

       buildings and improvements) as

 

       defined by Civil Aeronautics Board

 

       uniform accounts 5300, and

 

       expenditures which are not "excluded

 

       additions" as defined in section

 

       1.167(a)-11(d)(2)(vi) of the

 

       regulations and which would be

 

       charged to property and equipment

 

       accounts in the Civil Aeronautics

 

       Board uniform system of accounts     12       7         12

 

 

 45.1  AIR TRANSPORT (RESTRICTED):

 

 

       Includes each asset described in the

 

       description of class 45.0 which was

 

       held by the taxpayer on April 15,

 

       1976, or is acquired by the taxpayer

 

       pursuant to a contract which was, on

 

       April 15, 1976, and at all times

 

       thereafter, binding on the taxpayer.

 

       This criterion of classification

 

       based on binding contract concept is

 

       to be applied in the same manner as

 

       under the general rules expressed in

 

       section 49(b)(1), (4), (5) and (8)

 

       of the Code (as in effect prior to

 

       its repeal by the Revenue Act of

 

       1978, section 312(c)(1), (d), 1978-3

 

       C.B. 1, 60)                           6       5          6

 

 

 46.0  PIPELINE TRANSPORTATION:

 

 

       Includes assets used in the private,

 

       commercial, and contract carrying of

 

       petroleum, gas and other products by

 

       means of pipes and conveyors. The

 

       trunk lines and related storage

 

       facilities of integrated petroleum

 

       and natural gas producers are

 

       included in this class. Excludes

 

       initial clearing and grading land

 

       improvements as specified in Rev.

 

       Rul. 72-403, 1972-2 C.B. 102, but

 

       includes all other related land

 

       improvements                         22      15         22

 

 

       TELEPHONE COMMUNICATIONS:

 

 

       Includes the assets identified below

 

       and that are used in the provision

 

       of commercial and contract telephonic

 

       services such as:

 

 

 48.11 TELEPHONE CENTRAL OFFICE BUILDINGS:

 

 

       Includes assets intended to house

 

       central office equipment, as defined

 

       in Federal Communications Commission

 

       Part 31 Account No. 212 whether

 

       section 1245 or section 1250

 

       property                             45      20         45

 

 

 48.12 TELEPHONE CENTRAL OFFICE EQUIPMENT:

 

 

       Includes central office switching

 

       and related equipment as defined in

 

       Federal Communications Commission

 

       Part 31 Account No. 221

 

 

       Does not include computer-based

 

       telephone central office switching

 

       equipment included in class 48.121.

 

       Does not include private branch

 

       exchange (PBX) equipment             18      15         18

 

 

 48.121 COMPUTER-BASED TELEPHONE CENTRAL

 

        OFFICE SWITCHING EQUIPMENT:

 

 

       Includes equipment whose functions

 

       are those of a computer or

 

       peripheral equipment (as defined in

 

       section 168(i)(2)(B) of the Code)

 

       used in its capacity as telephone

 

       central office equipment. Does not

 

       include private branch exchange

 

       (PBX) equipment                      9.5      5         9.5

 

 

 48.13 TELEPHONE STATION EQUIPMENT:

 

 

       Includes such station apparatus and

 

       connections as teletypewriters,

 

       telephones, booths, private

 

       exchanges, and comparable equipment

 

       as defined in Federal Communications

 

       Commission Part 31 Account Nos. 231,

 

       232, and 234                         10       7 3     10 3

 

 

 48.14 TELEPHONE DISTRIBUTION PLANT:

 

 

       Includes such assets as pole lines,

 

       cable, aerial wire, underground

 

       conduits, and comparable equipment,

 

       and related land improvements as

 

       defined in Federal Communications

 

       Commission Part 31 Account Nos. 241,

 

       242.1, 242.2, 242.3, 242.4, 243, and

 

       244                                  24      15         24

 

 

 48.2  RADIO AND TELEVISION BROADCASTINGS:

 

 

       Includes assets used in radio and

 

       television broadcasting, except

 

       transmitting towers                   6       5          6

 

 

       TELEGRAPH, OCEAN CABLE, AND

 

       SATELLITE COMMUNICATIONS (TOCSC)

 

 

       Includes communications-related

 

       assets used to provide domestic and

 

       international radio-telegraph, wire-

 

       telegraph, ocean-cable, and

 

       satellite communications services;

 

       also includes related land

 

       improvements. If property described

 

       in Classes 48.31-48.45 is comparable

 

       to telephone distribution plant

 

       described in Class 48.14 and used

 

       for 2-way exchange of voice and data

 

       communication which is the

 

       equivalent of telephone

 

       communication, such property is

 

       assigned a class life of 24 years

 

       under this revenue procedure.

 

       Comparable equipment does not

 

       include cable television equipment

 

       used primarily for 1-way

 

       communication.

 

 

 48.31 TOCSC-ELECTRIC POWER GENERATING AND

 

       DISTRIBUTION SYSTEMS:

 

 

       Includes assets used in the

 

       provision of electric power by

 

       generation, modulation,

 

       rectification, channelization,

 

       control, and distribution. Does not

 

       include these assets when they are

 

 

       installed on customer's premises     19      10         19

 

 

 48.32 TOCSC-HIGH FREQUENCY RADIO AND

 

       MICROWAVE SYSTEM:

 

 

       Includes assets such as transmitters

 

       and receivers, antenna supporting

 

       structures, antennas, transmission

 

       lines from equipment to antenna,

 

       transmitter cooling systems, and

 

       control and amplification equipment.

 

       Does not include cable and long-line

 

       systems                              13       7         13

 

 

 48.33 TOCSC-CABLE AND LONG-LINE SYSTEMS:

 

 

       Includes assets such as transmission

 

       lines, pole lines, ocean cables,

 

       buried cable and conduit, repeaters,

 

       repeater stations, and other related

 

       assets. Does not include high

 

       frequency radio or microwave systems 26.5    20         26.5

 

 

 48.34 TOCSC-CENTRAL OFFICE CONTROL

 

       EQUIPMENT:

 

 

       Includes assets for general control,

 

       switching, and monitoring of

 

       communications signals including

 

       electromechanical switching and

 

       channeling apparatus, multiplexing

 

       equipment, patching and monitoring

 

       facilities, in-house cabling,

 

       teleprinter equipment, and

 

       associated site improvements         16.5    10         16.5

 

 

 48.35 TOCSC-COMPUTERIZED SWITCHING,

 

       CHANNELING, AND ASSOCIATED CONTROL

 

       EQUIPMENT:

 

 

       Includes central office switching

 

       computers, interfacing computers,

 

       other associated specialized control

 

       equipment, and site improvements     10.5     7         10.5

 

 

 48.36 TOCSC-SATELLITE GROUND SEGMENT

 

       PROPERTY:

 

 

       Includes assets such as fixed earth

 

       station equipment, antennas,

 

       satellite communications equipment,

 

       and interface equipment used in

 

       satellite communications. Does not

 

       include general purpose equipment or

 

       equipment used in satellite space

 

       segment property                     10       7         10

 

 

 48.37 TOCSC-SATELLITE SPACE SEGMENT

 

       PROPERTY:

 

 

       Includes satellites and equipment

 

       used for telemetry, tracking,

 

       control, and monitoring when used in

 

       satellite communications              8       5          8

 

 

 48.38 TOCSC-EQUIPMENT INSTALLED ON

 

       CUSTOMER'S PREMISES:

 

 

       Includes assets installed on

 

       customer's premises, such as

 

       computers, terminal equipment, power

 

       generation and distribution systems,

 

       private switching center,

 

       teleprinters, facsimile equipment,

 

       and other associated and related

 

       equipment                            10       7         10

 

 

 48.39 TOCSC-SUPPORT AND SERVICE EQUIPMENT:

 

 

       Includes assets used to support but

 

       not engage in communications.

 

       Includes store, warehouse and shop

 

       tools, and test and laboratory

 

       assets                               13.5     7         13.5

 

 

       CABLE TELEVISION (CATV)

 

 

       Includes communications-related

 

       assets used to provide cable

 

       television community antenna

 

       television services. Does not

 

       include assets used to provide

 

       subscribers with two-way

 

       communications services.

 

 

 48.41 CATV-HEADEND:

 

 

       Includes assets such as towers,

 

       antennas, preamplifiers, con-

 

       verters, modulation equipment,

 

 

       and program non-duplication

 

       systems. Does not include headend

 

       buildings and program origination

 

       assets                               11      7          11

 

 

 48.42 CATV-SUBSCRIBER CONNECTION AND

 

       DISTRIBUTION SYSTEMS:

 

 

       Includes assets such as trunk and

 

       feeder cable, connecting hardware,

 

       amplifiers, power equipment,

 

       passive devices, directional taps,

 

       pedestals, pressure taps, drop

 

       cables, matching transformers,

 

       multiple set connector equipment,

 

       and converters                       10      7          10

 

 

 48.43 CATV-PROGRAM ORIGINATION:

 

 

       Includes assets such as cameras,

 

       film chains, video tape recorders,

 

       lighting, and remote location

 

       equipment excluding vehicles. Does

 

       not include buildings and their

 

       structural components                9       5          9

 

 

 48.44 CATV-SERVICE AND TEST:

 

 

       Includes assets such as

 

       oscilloscopes, field strength

 

       meters, spectrum analyzers, and

 

       cable testing equipment, but

 

       does not include vehicles            8.5     5          8.5

 

 

 48.45 CATV-MICROWAVE SYSTEMS:

 

 

       Includes assets such as towers,

 

       antennas, transmitting and

 

       receiving equipment, and broad

 

       band microwave assets if used in

 

       the provision of cable television

 

       services. Does not include assets

 

       used in the provision of common

 

       carrier services                     9.5     5          9.5

 

 

       ELECTRIC, GAS, WATER AND STEAM,

 

       UTILITY SERVICES:

 

 

       Includes assets used in the

 

       production, transmission and

 

       distribution of electricity,

 

       gas, steam, or water for sale

 

       including related land

 

       improvements.

 

 

 49.11 ELECTRIC UTILITY HYDRAULIC

 

       PRODUCTION PLANT:

 

 

       Includes assets used in the

 

       hydraulic power production of

 

       electricity for sale, including

 

       related land improvements, such

 

       as dams, flumes, canals, and

 

       waterways                           50      20         50

 

 

 49.12 ELECTRIC UTILITY NUCLEAR PRODUCTION

 

       PLANT:

 

 

       Includes assets used in the nuclear

 

       power production and electricity for

 

       sale and related land improvements.

 

       Does not include nuclear fuel

 

       assemblies                           20      15         20

 

 

 49.121 ELECTRIC UTILITY NUCLEAR FUEL

 

        ASSEMBLIES:

 

 

       Includes initial core and

 

       replacement core nuclear fuel

 

       assemblies (i.e., the composite

 

       of fabricated nuclear fuel and

 

       container) when used in a boiling

 

       water, pressurized water, or high

 

       temperature gas reactor used in the

 

       production of electricity. Does not

 

       include nuclear fuel assemblies used

 

       in breeder reactors                  5       5          5

 

 

 49.13 ELECTRIC UTILITY STEAM PRODUCTION

 

       PLANT:

 

 

       Includes assets used in the steam

 

       power production of electricity for

 

       sale, combustion turbines operated

 

       in a combined cycle with a

 

       conventional steam unit and related

 

       land improvements. Also includes

 

       package boilers, electric generators

 

       and related assets such as

 

       electricity and steam distribution

 

 

       systems as used by a waste reduction

 

       and resource recovery plant if the

 

       steam or electricity is normally

 

       for sale to others                  28      20         28

 

 

 49.14 ELECTRIC UTILITY TRANSMISSION AND

 

       DISTRIBUTION PLANT:

 

 

       Includes assets used in the

 

       transmission and distribution of

 

       electricity for sale and related

 

       land improvements. Excludes initial

 

       clearing and grading land

 

       improvements as specified in Rev.

 

       Rul. 72-403, 1972-2 C.B. 102        30      20         30

 

 

 49.15 ELECTRIC UTILITY COMBUSTION TURBINE

 

       PRODUCTION PLANT:

 

 

       Includes assets used in the

 

       production of electricity for sale

 

       by the use of such prime movers as

 

       jet engines, combustion turbines,

 

       diesel engines, gasoline engines,

 

       and other internal combustion

 

       engines, their associated power

 

       turbines and/or generators, and

 

       related land improvements. Does

 

       not include combustion turbines

 

       operated in a combined cycle with

 

       a conventional steam unit           20      15         20

 

 

 49.21 GAS UTILITY DISTRIBUTION FACILITIES:

 

 

       Includes gas water heaters and gas

 

       conversion equipment installed by

 

       utility on customers' premises on a

 

       rental basis                        35      20         35

 

 

 49.221 GAS UTILITY MANUFACTURED GAS

 

        PRODUCTION PLANTS:

 

 

       Includes assets used in the

 

       manufacture of gas having chemical

 

       and/or physical properties which

 

       do not permit complete

 

       interchangeability with domestic

 

       natural gas. Does not include gas

 

       producing systems and related

 

       systems used in waste reduction and

 

       resource recovery plants which are

 

       elsewhere classified                30      20         30

 

 

 49.222 GAS UTILITY SUBSTITUTE NATURAL GAS

 

        (SNG) PRODUCTION PLANT (NAPHTHA OR

 

        LIGHTER HYDROCARBON FEEDSTOCKS):

 

 

       Includes assets used in the

 

       catalytic conversion of feedstocks

 

       or naphtha or lighter hydrocarbons

 

       to a gaseous fuel which is

 

       completely interchangeable with

 

       domestic natural gas                14      7          14

 

 

 49.223 SUBSTITUTE NATURAL GAS-COAL

 

        GASIFICATION:

 

 

       Includes assets used in the

 

       manufacture and production of

 

       pipeline quality gas from coal using

 

       the basic Lurgi process with

 

       advanced methanation. Includes all

 

       process plant equipment and

 

       structures used in this coal

 

       gasification process and all utility

 

       assets such as cooling systems,

 

       water supply and treatment

 

       facilities, and assets used in the

 

       production and distribution of

 

       electricity and steam for use by the

 

       taxpayer in a gasification plant and

 

       attendant coal mining of electricity

 

       and steam for sale to others. Also

 

       includes all other related land

 

       improvements. Does not include

 

       assets used in the direct mining and

 

       treatment of coal prior to the

 

       gasification process itself         18      10         18

 

 

 49.23 NATURAL GAS PRODUCTION PLANT:       14       7         14

 

 

 49.24 GAS UTILITY TRUNK PIPELINES AND

 

       RELATED STORAGE FACILITIES:

 

 

       Excluding initial clearing and grading land

 

       improvements as specified in Rev.

 

       Rul. 72-403                         22      15         22

 

 

 49.25 LIQUEFIED NATURAL GAS PLANT:

 

       Includes assets used in the

 

 

       liquefication, storage, and

 

       regasification of natural gas

 

       including loading and unloading

 

       connections, instrumentation

 

       equipment and controls, pumps,

 

       vaporizers and odorizers, tanks,

 

       and related land improvements. Also

 

       includes pipeline interconnections

 

       with gas transmission lines and

 

       distribution systems and marine

 

       terminal facilities                 22      15         22

 

 

 49.3  WATER UTILITIES:

 

 

       Includes assets used in the

 

       gathering, treatment, and commercial

 

       distribution of water               50      20         50

 

 

 49.4  CENTRAL STEAM UTILITY PRODUCTION AND

 

       DISTRIBUTION:

 

 

       Includes assets used in the

 

       production and distribution of steam

 

       for sale. Does not include assets

 

       used in waste reduction and resource

 

       recovery plants which are elsewhere

 

       classified                          28      20         20

 

 

 49.5  WASTE REDUCTION AND RESOURCE

 

       RECOVERY PLANTS:

 

 

       Includes assets used in the

 

       conversion of refuse or other solid

 

       waste or biomass to heat or to a

 

       solid, liquid, or gaseous fuel. Also

 

       includes all process plant equipment

 

       and structures at the site used to

 

       receive, handle, collect, and

 

       process refuse or other solid waste

 

       or biomass to a solid, liquid, or

 

       gaseous fuel or to handle and burn

 

       refuse or other solid waste or

 

       biomass in a waterwall combustion

 

       system, oil or gas pyrolysis system,

 

       or refuse derived fuel system to

 

       create hot water, gas, steam and

 

       electricity. Includes material

 

       recovery and support assets used in

 

       refuse or solid refuse or solid

 

       waste receiving, collecting,

 

       handling, sorting, shredding,

 

       classifying, and separation systems.

 

       Does not include any package

 

       boilers, or electric generators and

 

       related assets such as electricity,

 

       hot water, steam and manufactured

 

       gas production plants classified in

 

       classes 00.4, 49.13, 49.221, and

 

       49.4. Does include, however, all

 

       other utilities such as water supply

 

       and treatment facilities, ash

 

       handling and other related land

 

       improvements of a waste reduction

 

       and resource recovery plant         10      7          10

 

 

 50. MUNICIPAL WASTEWATER TREATMENT PLANT  24      15         24

 

 

 51.   MUNICIPAL SEWER                     50      20         50

 

 

 57.0  DISTRIBUTIVE TRADES AND SERVICES:

 

 

       Includes assets used in wholesale

 

       and retail trade, and personal and

 

       professional services. Includes

 

       section 1245 assets used in

 

       marketing petroleum and petroleum

 

       products                             9       5          9 4

 

 

 57.1  DISTRIBUTIVE TRADES AND SERVICES-

 

       BILLBOARD, SERVICE STATION BUILDINGS

 

       AND PETROLEUM MARKETING LAND

 

       IMPROVEMENTS:

 

 

       Includes section 1250 assets,

 

       including service station buildings

 

       and depreciable land improvements,

 

       whether section 1245 property or

 

       section 1250 property, used in the

 

       marketing of petroleum and petroleum

 

       products, but not including any of

 

       these facilities related to

 

       petroleum and natural gas trunk

 

       pipelines. Includes car wash

 

       buildings and related land

 

       improvements. Includes billboards,

 

       whether such assets are section 1245

 

       property or section 1250 property.

 

       Excludes all other land

 

       improvements, buildings and

 

       structural components as defined

 

 

       in section 1.48-1(e) of the

 

       regulations                         20      15          20

 

 

 79.0  RECREATION:

 

 

       Includes assets used in the

 

       provision of entertainment services

 

       on payment of a fee or admission

 

       charge, as in the operation of

 

       bowling alleys, billiard and pool

 

       establishments, theaters, concert

 

       halls, and miniature golf courses.

 

       Does not include amusement and theme

 

       parks and assets which consist

 

       primarily of specialized land

 

       improvements or structures, such as

 

       golf courses, sports stadia, race

 

       tracks, ski slopes, and buildings

 

       which house the assets used in

 

       entertainment services              10       7          10

 

 

 80.0  THEME AND AMUSEMENT PARKS:

 

 

       Includes assets used in the

 

       provision of rides, attractions, and

 

       amusements in activities defined as

 

       theme and amusement parks, and

 

       includes appurtenances associated

 

       with a ride, attraction, amusement

 

       or theme setting within the park

 

       such as ticket booths, facades, shop

 

       interiors, and props, special

 

       purpose structures, and buildings

 

       other than warehouses,

 

       administration buildings, hotels,

 

       and motels. Includes all land

 

       improvements for or in support of

 

       park activities, (e.g., parking

 

       lots, sidewalks, waterways, bridges,

 

       fences, landscaping, etc.) and

 

       support functions (e.g., food and

 

       beverage retailing, souvenir vending

 

       and other nonlodging accomodations)

 

       if owned by the park and provided

 

       exclusively for the benefit of park

 

       patrons. Theme and amusement parks

 

       are defined as combinations of

 

       amusements, rides, and attractions

 

       which are permanently situated on

 

       park land and open to the public for

 

       the price of admission. This

 

       guideline class is a composite of

 

       all assets used in this industry

 

       except transportation equipment

 

       (general purpose trucks, cars,

 

       airplanes, etc., which are included

 

       in asset guideline classes with the

 

       prefix 00.2), assets used in the

 

       provision of administrative services

 

       (asset classes with the prefix

 

       00.1), and warehouses,

 

       administration buildings, hotels

 

       and motels                          12.5     7         12.5

 

 

       CERTAIN PROPERTY FOR WHICH RECOVERY

 

       PERIODS ASSIGNED

 

 

       A. Personal Property With No Class

 

       Life                                         7         12

 

 

       Section 1245 Real Property With No

 

       Class Life                                   7         40

 

 

       B. Qualified Technological

 

       Equipment, as defined in section

 

       168(i)(2).                           5     5          5

 

 

       C. Property Used in Connection with

 

       Research and Experimentation

 

       referred to in section 168(e)(3)(B)  5     5      class life

 

                                                           if no class

 

                                                           life -- 12

 

 

       D. Alternative Energy Property

 

       described in sections 48(1)(3)(viii)

 

       or (iv), or section 48(1)(4) of the

 

       Code.                                5     5       class life

 

                                                            if no class

 

                                                            life -- 12

 

 

       E. Biomass property described in

 

       section 48(1)(15) and is a

 

       qualifying small production facility

 

       within the meaning of section

 

       3(17)(c) of the Federal Power Act,

 

       (16 U.S.C. 796(17)(C)), as in effect

 

       on September 1, 1986                 5     5       class life

 

                                                            if no class

 

                                                            life -- 12

 

 

1 Property described in asset class 00.12 which is qualified technological equipment as defined in section 168(i)(2) is assigned a recovery period of 5 years notwithstanding its class life. See section 3 of the revenue procedure.

2 Property described in asset guideline class 01.222 is assigned a 3-year recovery period under section 168(e)(3)(A), but has no class life.

3 Property described in asset guideline class 48.13 which is qualified technological equipment as defined in section 168(i)(2) is assigned a 5-1/2 year recovery period for both the general and alternative depreciation systems.

4 Any high technology medical equipment as defined in section 168(i)(2)(C) which is described in asset guideline class 57.0 is assigned a 5-1/2 year recovery period for the alternative depreciation system.

5 The class life (if any) of property described in classes B, C, D, or E is determined by reference to the asset guideline classes in this revenue procedure. If an item of property described in paragraphs B, C, D, or E is not described in any asset guideline class, such item of property has no class life.

DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Index Terms
    depreciation
    class life
  • Jurisdictions
  • Language
    English
  • Tax Analysts Electronic Citation
    87 TNT 203-18
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