- 45 -
________________
4 For example, an interest deduction that is disallowed
under section 265 or 291 should not be allowed, capitalized,
or suspended under another provision.
The Congress’s suggestion, however, specifically related to
the allocation rules for section 469 only; the Joint Statement of
Managers portion of the conference committee report does not
provide a similar prescription for allocating interest expense
for purposes of subsections (d) and (h) of section 163. In TAMRA
1988, the Congress amended subsections (d) and (h) of section 163
to conform the relevant language thereof to the relevant language
of section 469 in order to achieve “consistent application of a
standard for allocation of interest” among the “related
provisions” of sections 163(d), 163(h), and 469. By conforming
the language of subsections (d) and (h) to section 163 to the
relevant language of section 469, the Congress gave a clear
indication that the tracing regime it contemplated for purposes
of section 469 is the allocation method that it also intended for
subsections (d) and (h) of section 163. See Appendix pp. 73-74.
An examination of section 1.163-8T, Temporary Income Tax
Regs., supra, shows that the Secretary heeded the Congress’s
suggestion. Section 1.163-8T, Temporary Income Tax Regs., supra,
imposes the very tracing regime that the Congress contemplated.
Sec. 1.163-8T(a)(3), Temporary Income Tax Regs., supra.
In sum, the Congress suggested the means by which to
allocate interest expense for purposes of section 469; the
Page: Previous 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 NextLast modified: May 25, 2011