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length of which can be estimated with reasonable
accuracy, such an intangible asset may be the subject
of a depreciation allowance. Examples are patents and
copyrights. An intangible asset, the useful life of
which is not limited, is not subject to the allowance
for depreciation. No allowance will be permitted
merely because, in the unsupported opinion of the
taxpayer, the intangible asset has a limited useful
life. * * *
The standard for deciding whether an intangible is depreciable
under section 167 was enunciated in Newark Morning Ledger Co. v.
United States, 507 U.S. 546, 566 (1993), as follows:
a taxpayer [must] prove with reasonable accuracy that
an asset used in the trade or business or held for the
production of income has a value that wastes over an
ascertainable period of time * * *
The availability of a depreciation deduction is primarily a
question of fact, id. at 560, on which the taxpayer bears the
burden of proof. Id. at 566.
Petitioner contends (in the alternative) that the
expenditures it incurred in launching the RIC's should be
amortized over an average useful life of 2.2 years. Petitioner
argues that the recovery period of 2.2 years is determined by the
average life of initial investments in a new RIC and is similar
to the recovery of bank acquisition expenditures allocable to the
deposits in the acquired bank over the period in which these
deposits can be shown to decline in value to the acquirer. See
Citizens & S. Corp. v. Commissioner, 91 T.C. 463 (1988), affd.
919 F.2d 1492 (11th Cir. 1990).
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