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long as the contracts relating to the costs of the property were
entered into on or before December 31, 1985. See TRA 1986,
sec. 204(a), 100 Stat. 2146, as amended by TRA 1986, sec. 211,
100 Stat. 2167 (adding Code sec. 49(e)(1)(B)).
Under one of the transition rules that relates specifically
to “supply or service” contracts, taxpayers were allowed ITC for
qualified property costs that were “readily identifiable with and
necessary to carry out” written contracts that were binding on or
before December 31, 1985 (hereinafter referred to as “the supply
or service transition rule”). TRA 1986, sec. 204(a)(3), 100
Stat. 2149, as amended by TRA 1986, sec. 211, 100 Stat. 2167
(adding Code sec. 49(e)(1)(B)). The supply or service transition
rule, as amended and in effect for the years in issue, provided
as follows:
(3) Supply or service contracts.--The amendments made
by section 201 shall not apply to any property which is
readily identifiable with and necessary to carry out a
written supply or service contract, or agreement to lease,
which was binding on December 31, 1985.
Id.
With regard to the January 1, 1991, cutoff date, the
transition rules provided as follows:
(2) Requirement that certain property be placed in
service before certain date.--
(A) In general.--Paragraph (1) and section
204(a)(other than paragraph (8) or (12) thereof) shall
not apply to any property unless such property has a
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Last modified: May 25, 2011