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basis of its subscriber relationships for the editorial costs and
associated tax benefits becoming fixed in its TYE 1990.
II. Meredith I Does Not Preclude Petitioner's Deduction for
Editorial Costs Incurred During Its TYE 1990
Respondent alternatively contends that "Nothing in the
Court's Opinion in Meredith I even remotely suggests that
Petitioner is entitled to an ordinary deduction [in its TYE
1990]" for additional contingent costs becoming fixed in that
year. Nothing, however, in our Opinion suggests otherwise.
Respondent nonetheless claims that "strictly speaking, the
Court's Opinion [in Meredith I] precludes the deduction claimed
by * * * [Meredith] for the taxable year ended June 30, 1990
* * * [because of the expiration of the stipulated 42-month
useful life]". She cites the following language from Meredith I
to support her proposition:
The amounts are not subject to a new depreciation
schedule, but, rather, are to be depreciated over the
remaining useful life of the subscriber relationships
based on a useful life ending 42 months after the
acquisition of the subscribers. * * * Meredith Corp.
& Subs. v. Commissioner, 102 T.C. at 462-463.
However, the language above is inapposite to Meredith's TYE 1990
at issue in the instant matter. Placed in context, the words
"the amounts" refer to the 1986 and 1987 additions to basis only.
The penultimate sentence before the quotation computes dollar
amounts for 1986 and 1987. Moreover, the sentence before the
quoted language refers to "these amounts", meaning the 1986 and
1987 sums.
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