- 26 -
petitioner argues that CITGO may need to move a tank by lifting
it off the ground in order to repair corrosion of the steel
plates on the tank’s underside. Petitioner also asserts that the
least intrusive method for replacing contaminated sand underneath
a tank involves moving the tank, either by suspending the tank in
the air or temporarily moving the tank off its foundation, to the
side. Furthermore, petitioner argues, possible changes in
terminal demand may lead to the sale or closing of terminals or
the sale of tanks, scenarios in which it is reasonably likely
that CITGO may have to move tanks.
On the other hand, respondent contends that the tanks’ ages,
their location on fee simple land, and CITGO’s attempts to extend
their useful lives with extensive maintenance and repairs
demonstrate that CITGO intended to keep the tanks in place
permanently. Respondent also asserts that CITGO’s two prior tank
relocations for environmental reasons were unusual occurrences
and do not demonstrate “any real likelihood” that CITGO may have
to move a tank.
In Whiteco Indus., Inc. v. Commissioner, 65 T.C. at 672, we
concluded that the taxpayer “[did] not intend, nor could it
realistically expect, the signs to remain permanently in place.”
We observed that the taxpayer was aware that “numerous
situations” could arise which would necessitate moving the signs
either before or after the expiration of the taxpayer’s contract
Page: Previous 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 NextLast modified: May 25, 2011