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263A was enacted during 1986, and, through the years in
controversy, no regulations3 or other notification had been
issued to provide guidance regarding the nationwide weighted
average preproductive period for citrus trees.4
In these circumstances, respondent argues that petitioner
has failed to show the nationwide average preproductive period
for citrus trees and that the corporation should not be entitled
to meet the statutory requirement by using its own citrus tree
experience. Respondent also argues that congressional intent was
to include citrus trees within the capitalization requirements of
section 263A; i.e., that Congress knew that the preproductive
period for citrus trees was more than 2 years.
Petitioner argues that the corporation is not responsible
for determining the nationwide weighted average preproductive
period for citrus trees and that it should be allowed to meet the
requirements by showing that its actual experience resulted in a
3 Respondent makes the observation that the periodic
publication of a list of the national weighted averages for
preproductive periods for various plants would, as a matter of
practice, have been issued in some form of notice and not be
published in the more formal vehicle of a regulation.
4 No final regulation on this point has been issued.
Subsequent to the taxable years under consideration, however, the
U.S. Department of the Treasury issued temporary regulations,
which included a statement that the U.S. Department of the
Treasury intended to publish a list of 37 plants, including
orange, grapefruit, and tangerine trees, that were expected to
have a preproductive period in excess of 2 years. See T.D. 8729,
1997-2 C.B. 38.
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