- 34 -
Accordingly, we must decide whether the tests developed under
prior law for purposes of the investment tax credit must be used
in deciding the appropriate recovery classes (for tax years ended
1985 and 1986) or appropriate recovery periods (for tax years
ended 1987 and 1988) for the disputed property items that
petitioners placed in service during those years and, if so,
whether the respective properties constitute section 1245 class
property or section 1250 class property pursuant to those tests.
Petitioners contend that the disputed property items
constitute section 1245 class property and that those items are
depreciable over 5-year periods. Respondent contends that the
disputed property items are section 1250 class property because
they are structural components of the buildings to which they
relate, and, thus, they are depreciable over the same recovery
period as the buildings.
22 (...continued)
(SIIR), Pub. L. 99-121, secs. 103, 105(a), 99 Stat. 509-511
(1985). The recovery for real property placed in service after
May 8, 1985, but before Dec. 31, 1986, generally is 19 years.
SIIR, secs. 103, 105(a); Tax Reform Act of 1986 (TRA-1986), Pub.
L. 99-514, secs. 201, 203, 100 Stat. 2122-2123, 2143. The
recovery period for nonresidential real property placed in
service after Dec. 31, 1986, but before May 12, 1993, generally
is 31.5 years. TRA-86, secs. 201, 203; Omnibus Budget
Reconciliation Act of 1993 (OBRA-1993), Pub. L. 103-66, sec.
13151, 107 Stat. 448. For convenience, we refer to property
placed in service between Jan. 1, 1985, and Dec. 31, 1986,
generally as 19-year property.
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