Clajon Gas Co., L.P., Aquila Gas Pipeline Corp., Tax Matters Partner - Page 23

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          included in any asset guideline class must be based upon the                
          “class life prescribed by the Secretary which reasonably reflects           
          the anticipated useful life of that class of property to the                
          industry or other group.”  (Emphasis added.)  Such an approach is           
          also consistent with Treasury’s description of section 1.167(a)-            
          11, Income Tax Regs., as, essentially, an extension of the                  
          composite class life system adopted in Rev. Proc. 62-21, 1962-2             
          C.B. 418.  See supra sec. III.                                              
                    (2)  Asset Class 13.2                                             
               Asset guideline class 13.2 describes property, including               
          gathering pipelines, used by natural gas producers.  Since,                 
          however, we have found that petitioner is not a natural gas                 
          producer, its gathering pipelines are not 13.2 property.  Given             
          the composite nature of class lives, that is an appropriate                 
          result.  If a taxpayer is not engaged in the activity described             
          in an asset guideline class, then the associated class life is              
          not representative of the life of any class of business assets              
          owned by him.  Only by coincidence would the class life be the              
          useful life of any asset owned by the taxpayer.  To permit such a           
          taxpayer to depreciate a particular asset or type of asset on the           
          basis of a composite class life designed for a completely                   
          different group of taxpayers utilizing a completely different mix           
          of assets would be to frustrate the overall intent and design of            
          the class life system adopted by Congress and implemented by the            

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