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immediately above) over the aggregate number
of cattle listed in the partnerships’ books
and records and subject to depreciation.
For example, in the year 1980, the books
and records of Florin Farms # 1 indicate
that the partnership claimed 149 head of
cattle subject to depreciation. The
aggregate number of cattle listed in the
depreciation schedules of all the
investor partnerships was 4,659. For
purposes of this case, then, Florin
Farms # 1 would be considered to have 56
head of cattle subject to depreciation,
computed as follows:
149 x 1,736 = 56
4,659
• Depreciation for all cattle placed in service in
1980 will be computed using the straight line
method and a 5 year useful life -- without regard
to the ADR system, or any other methods previously
used.
• All cattle which were already in partnerships on
January 1, 1980, will be considered placed in
service in 1977. Such cattle would, therefore, be
eligible for depreciation for only 2 years -- 1980
and 1981. They would then be considered fully
depreciated.
• Depreciation for all cattle placed in service
after 1980 will be computed using the Accelerated
Cost Recovery System, considering the cattle 5-
year property.
• All purchases of cattle after 1981 are in the year
the partnership is formed.
• Investment tax credit will be allowed on the
number of cattle in service during the first year
of the partnership’s existence (as revised by the
formula discussed above), times $4,000 per head.
Cattle will be considered placed in service in the
year the partnership is formed.
• All cattle purchased are new section 38 property.
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