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from the provisions dealing with accounting matters. Compare
title V entitled "Tax Shelter Limitations; Interest Limitations",
which includes the provisions of section 469, with title VIII
"Accounting Provisions" of the Tax Reform Act of 1986, Pub. L.
99-514, 100 Stat. 2085, 2233-2249, 2345-2375; H. Conf. Rept. 99-
841 (Vol. II), supra, 1986-3 C.B. (Vol. 4) at 134, 285.
We are not impressed by petitioner's attempt to reinforce
the "method of accounting" argument that PAL's should not be
treated in the same fashion as NOL's under section 1371(b)(1) by
pointing to the fact that the regulations under section 469
disallow ratably the deductions which enter into the
determination of whether the taxpayer has incurred a PAL. The
regulations upon which petitioner bases this argument provide:
(ii) Allocation within loss activities--(A) In
general. If all or any portion of a taxpayer's loss
from an activity is disallowed under paragraph
(f)(2)(i) of this section for the taxable year, a
ratable portion of each passive activity deduction
(other than an excluded deduction (within the meaning
of paragraph (f)(2)(ii)(B) of this section)) of the
taxpayer from such activity is disallowed. * * *
* * * * * * *
(iii) Separately identified deductions. In
identifying the deductions from an activity that are
disallowed under this paragraph (f)(2), the taxpayer
need not account separately for a deduction unless such
deduction may, if separately taken into account, result
in an income tax liability for any taxable year
different from that which would result were such
deduction not taken into account separately. * * *
[Sec. 1.469-1T(f)(2), Temporary Income Tax Regs., 53
Fed. Reg. 5706 (Feb. 25, 1988); emphasis added.]
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