ABC Rentals of San Antonio, Inc., et al - Page 20

                                       - 20 -                                         

          that Guaranteed did not even meet the less stringent requirements           
          of section 1.168-5(e)(3), Proposed Income Tax Regs., supra,                 
          assuming arguendo they were otherwise applicable.  Section 1.168-           
          5(e)(3) provides:                                                           
                    (3) Manner of making elections.  Except as provided in            
               subparagraph (5), Form 4562 is provided for making an                  
               election under this paragraph and for submitting the                   
               information required.  The taxpayer must specify in the                
               election--                                                             
                         (i) The name of the taxpayer;                                
                         (ii) The taxpayer's identification number;                   
                         (iii)The year the recovery property was placed in            
                    service (or, in the case of 15-year real property, the            
                    month the property was placed in service);                        
                         (iv) The unadjusted basis of the recovery                    
                    property; and                                                     
                         (v) Such other information as may be required.               
               An election will not be rendered invalid so long as there is           
               substantial compliance, in good faith, with the requirements           
               of subparagraph (3).                                                   
          Statement 2 did not provide the year the rental property was                
          placed in service--in the "Date Acquired" column, Statement 2               
          says "VAR".  In addition, Statement 2 did not provide the                   
          unadjusted basis of the rental property--the "Cost or Basis"                
          column is blank.                                                            
               Furthermore, section 1.168-5(e)(3), Proposed Income Tax                
          Regs., supra, states that Form 4562, Depreciation and                       
          Amortization, is provided for making the election.  The 1987                
          instructions for this form provide the following guidance for               
          line 9 of section C, Other Depreciation:                                    







Page:  Previous  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  Next

Last modified: May 25, 2011