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Nothing in ABC's return indicates it was electing the income
forecast method of depreciation.
ABC attached Statement 4 to its tax return for its short
taxable period ending December 31, 1987. Statement 4 provided
that the type of property being depreciated was "RENTAL
INVENTORY" and that a method of depreciation--"INCOME
FORECASTING"--was used other than ACRS or MACRS. The statement
did not refer to section 168(f)(1) or any other Code section.
Statement 4 provided the year the rental property was placed in
service--"6/30/87", as well as the unadjusted or cost basis of
the rental property--"624,899".
For rental units placed in service by Guaranteed and ABC in
1988, respondent does not contest the form or timing of the
election. The parties have stipulated that the Entities have
filed elections pursuant to section 168(f)(1) to select the
income forecast method of depreciation for the tax years ending
December 31, 1988. Statement 10 attached to Guaranteed's 1988
income tax return contained the following:
SECTION 168(F)(1) ELECTION TO EXCLUDE PROPERTY FROM ACRS
BY USE OF A METHOD OF DEPRECIATION NOT EXPRESSED IN A TERM
OF YEARS: RENTAL INVENTORY
1. NAME OF TAXPAYER: GUARANTEED RENTAL SYSTEM, INC.
2. TAXPAYER I.D. # : 74-2390641
3. YEAR RECOVERY PROPERTY PLACED IN SERVICE: VARIOUS
4. UNADJUSTED BASIS OF RECOVERY PROPERTY: $210,138
5. METHOD OF DEPRECIATION: INCOME FORECASTING
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