109 T.C. No.19
UNITED STATES TAX COURT
DUKE ENERGY NATURAL GAS CORPORATION, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 12720-96. Filed December 16, 1997.
P owns and operates various systems of
interconnected subterranean natural gas gathering
pipelines and related compression facilities (the
gathering systems). P argues that the modified
accelerated cost recovery system allows P to depreciate
the gathering systems over 7 years because P is a
producer of natural gas within the meaning of Class
13.2 of Rev. Proc. 87-56, 1987-2 C.B. 674. R argues
that P must depreciate the gathering systems over 15
years because P transports gas, which brings P within
Class 46.0 of Rev. Proc. 87-56, supra.
Held: P transports, and does not produce, gas;
thus, P must depreciate the gathering systems over 15
years.
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