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benefits paid by ACC in connection with its loan origination/
acquisition activities.
2. Professional Fees
Capitalization is “consistent with the capitalization
arguments presented for the loan origination/acquisition and
offering expenses of ACC in [Lychuk].” Respondent argues that
“the professional fees at issue were related to ACC’s securing a
line of credit with NBD Bank, N.A., and, thus, were similar to
the offering expenses incurred in securing the source of
borrowing in Lychuk.” Also, like the offering expenses
capitalized in Lychuk, they established an intangible asset (a
line of credit) that “extended beyond the year in which the fees
were incurred.”
3. Timeliness of Respondent’s Concessions
a. Loan Origination/Acquisition Costs
Respondent’s April 19, 2002, concession that petitioners’
loan origination/acquisition costs for the audit years are
deductible, just over 1 month after the issuance of CCN 2002-21,
on March 15, 2002 (wherein the IRS announced that it would no
longer seek to capitalize employee compensation related to a
capital transaction other than bonuses and commissions paid with
respect to the transaction), was timely.
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