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period is an element in the calculation of the deduction for
depreciation allowed by section 167. The parties disagree as to
whether the recovery period applicable to the furniture and fixtures
is 5 years or 7 years. Petitioner argues that it is 5 years, while
respondent argues that it is 7 years. UBC originally determined
that the recovery period applicable to the furniture and fixtures
was 7 years and applied that period to the furniture and fixtures in
making its consolidated returns for 1987, 1988, and 1989. In the
relevant petitions, petitioner avers that UBC’s original
determination of the applicable recovery period was mistaken, and
that the correct applicable recovery period is 5 years. Petitioner
asks that the Court determine an overpayment in tax on account of
that mistake. The aggregate cost bases for the furniture and
fixtures placed in service in 1987, 1988, and 1989 are $5,710,643,
$1,490,930, and $546,707, respectively.
The parties disagree as to whether a similar question is before
the Court with respect to the UBC affiliated group’s 1990 and
(short) 1991 taxable years. During those years, various members of
the UBC affiliated group placed in service additional furniture and
fixtures (the 1990-91 furniture and fixtures). UBC determined that
the recovery period applicable to the 1990-1991 furniture and
fixtures was 5 years and applied that period to those furniture and
fixtures in making its consolidated returns for 1990 and 1991.
Respondent made no adjustment with respect to that determination.
In the relevant petition, petitioner included the 1990-91 furniture
and fixtures with the furniture and fixtures in its averment that
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