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placed in service.
In respondent’s view, the computer equipment and software
that petitioner Michael H. Visin purchased and placed in service
in 1998 may not be expensed under section 179 because petitioners
failed to make an election on their return consistent with
section 179(c) and the regulations thereunder.
Section 179(c)(1) provides that an election under section
179 shall:
(A) specify the items of section 179 property to
which the election applies and the portion of the cost
of each of such items which is to be taken into account
under subsection (a), and
(B) be made on the taxpayer’s return of the tax
imposed by this chapter for the taxable year.
Section 179(c)(1) goes on to provide that the election to expense
“shall be made in such manner as the Secretary may by regulations
prescribe.”
Regulations regarding the time and manner of making an
election under section 179 have been prescribed and may be found
in section 1.179-5, Income Tax Regs. Specifically, section
1.179-5(a), Income Tax Regs., requires a separate election for
each taxable year and, as relevant herein, that such election be
made on the taxpayer’s first income tax return for the taxable
year to which the election applies. The regulation goes on to
track the statutory requirements of section 179(c)(1)(A) and (B).
Finally, the regulation requires that the taxpayer maintain
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