Clajon Gas Co., L.P., Aquila Gas Pipeline Corp., Tax Matters Partner - Page 11

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          of Rev. Proc. 62-21, 1962-2 C.B. 418, the Treasury introduced a             
          fundamental change in the concept of depreciation.  T.P. at 212-            
          213.  The fundamental change was to classify assets on a basis              
          other than the particular life of the particular asset to the               
          particular user.  Id. at 215.  On the new basis, assets were                
          classified “as a stock of capital even though assets within a               
          class were heterogeneous with respect to ages, useful lives, and            
          physical characteristics.”  Id.  “Assets within the class would             
          have individual lives far longer and far shorter than the                   
          guideline class life.”  Id. at 215-216.  The Treasury Publication           
          describes Rev. Proc. 62-21 as providing a substitute for the                
          thousands of asset classifications of the previous system.  Id.             
          at 212-213.  Under Rev. Proc. 62-21, “assets were grouped by                
          broad industrial classifications and by certain broad general               
          asset classifications, with a ‘guideline life’ established for              
          each of these classes.”  Id. at 213.  An examination of the asset           
          guideline classes in Rev. Proc. 62-21 discloses that, generally,            
          the classes are tied to particular business activities.  The                
          drafters of the revenue procedure recognized that the anticipated           
          useful life of many assets, even the same types of assets, will             
          vary in accordance with the experience of persons using such                
          assets.  The drafters assumed that persons in the same business             
          activity would have similar experiences and, except for assets              

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