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Issue 2. Recovery Period
We must decide the applicable recovery period for the
Tobacco Barn. Respondent determined that the Tobacco Barn is 20-
year property. Petitioners contend that the Tobacco Barn is 10-
year or in the alternative 15-year property. We agree with
respondent.
The applicable recovery period is an element in the
calculation of the deduction for depreciation allowed by section
167. As pertinent here, section 168(c) provides the following
applicable recovery periods:
Type of property Applicable recovery period
10-year property 10 years
15-year property 15 years
20-year property 20 years
Section 168(e)(1) generally defines 10-year property as
property having a class life of 16 years or more, but less than
20 years, 15-year property as property having a class life of 20
years or more, but less than 25 years, and 20-year property as
property having a class life of 25 or more years. "Class life",
as defined by section 168(i)(1), is determined by reference to
former section 167(m), as in effect prior to its repeal by the
OBRA sec. 11812(a), 104 Stat. 1388-534. Section 167(m) provided
for a depreciation allowance based upon the class life prescribed
by the Secretary of the Treasury or his delegate.
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