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1379 (“an expenditure that would ordinarily be a deductible
expense must nonetheless be capitalized if it is incurred in
connection with the acquisition of a capital asset”); cf. A.E.
Staley Manufacturing Co. & Subs. v. Commissioner, 119 F.3d 482,
489 (7th Cir. 1997) (costs are capital expenditures if they are
“associated with” facilitating a capital transaction), revg. on
other grounds and remanding 105 T.C. 166 (1995); Central Tex.
Sav. & Loan Association v. United States, 731 F.2d 1181, 1184
(5th Cir. 1984) (“expenditures incurred in the acquisition of a
capital asset must generally be capitalized”); Commissioner v.
Wiesler, 161 F.2d 997, 999 (6th Cir. 1947) (“well settled rule
that expenditures incurred as an incident to the acquisition or
sale of property are not ordinary and necessary business
expenses, but are capital expenditures which must be added to the
cost of the property”), affg. 6 T.C. 1148 (1946).
Capitalizable expenditures are not limited to the actual
price that the buyer pays to the seller for the asset but
include, for example, the payment of legal, brokerage,
accounting, appraisal and other “ancillary” expenses related to
the asset’s acquisition. Woodward v. Commissioner, supra at
576-577; see United States v. Hilton Hotels Corp., 397 U.S. 580
(1970); see also Ellis Banking Corp. v. Commissioner, supra at
1379. Capitalizable expenditures also include compensation paid
for services performed in connection with an asset’s acquisition,
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