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Internal Revenue Code effective for amounts paid or
incurred after Dec. 31, 1986, in taxable years ending after
that date.
Held: Sec. 175(c)(3)(A)(i) and (ii), I.R.C., limits
the deduction of soil and water conservation expenditures
to those that are consistent with a soil conservation plan
approved by the Soil Conservation Service (SCS) of the
Department of Agriculture or a soil conservation plan of a
State agency, which agency is comparable to the SCS. The
area where the land to which the plan relates must be
located within the United States, and not in a foreign
country.
John R. Wilson, Robert S. Rich, and Patrick A. Jackman, for
petitioners.
Frederick J. Lockhart, Jr., for respondent.
OPINION
NIMS, Judge: Respondent issued a notice of final
partnership administrative adjustment (FPAA) to each of the two
subject partnerships, disallowing in each instance soil and water
conservation expenditure deductions under section 175, as
follows:
Partnership Taxable Year Amount of Deduction
Ending Disallowed
Koramba Farmers & June 30, 1987 $806,633
Graziers No. 1 June 30, 1988 519,004
(Koramba No. 1)
Koramba Farmers & June 30, 1988 1,011,360
Graziers No. 2 June 30, 1989 2,683,415
(Koramba No. 2)
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