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deduction would be allowable for the rental unit. Section
168(f)(1) provides:
(f) Property to Which Section Does Not Apply.--This
section shall not apply to--
(1) Certain methods of depreciation.--Any
property if--
(A) the taxpayer elects to exclude such
property from the application of this section, and
(B) for the 1st taxable year for which a
depreciation deduction would be allowable with
respect to such property in the hands of the
taxpayer, the property is properly depreciated
under the unit-of-production method or any method
of depreciation not expressed in a term of years
(other than the retirement-replacement-betterment
method or similar method).
Section 2.02 of Revenue Procedure 87-57, 1987-2 C.B. 687,
688, provides that the election under section 168(f)(1) must be
made following the procedures set forth in section 2.10 of the
Revenue Procedure. Section 2.10 of Revenue Procedure, 1987-2
C.B. at 689, provides,
.10 Time and manner for making elections. Under
section 5h.5(a)(2) of the temporary regulations, after April
14, 1987, an election described in this revenue procedure
shall be made by the due date (taking extensions into
account) of the tax return for the first taxable year for
which the election is to be made. The tax return must be
accompanied by a statement identifying the election by
reference to Code or Act section and identifying the
property items for which the election is being made.
Section 5h.5, Temporary Tax Reform Act of 1986 Election
Regs., 52 Fed. Reg. 3624 (Feb. 5, 1987), effective February 5,
1987, applies to section 168(f)(1) elections and sets forth the
time and manner guidelines for elections made after October 22,
1986. The election for section 168(f)(1) is available for
property placed in service after December 31, 1986. Section
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