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to Rule 121.1 Petitioner seeks a determination that its method
of accounting, for purposes of determining repair versus capital
expenses for the taxable years 1988 to 1992, is what petitioner
characterizes as “the method required by Section 1.162-4 of the
Regulations”. In its first amended petition, petitioner claimed
that under this “method of accounting” it is entitled to
additional deductions for repair expenses in the following
amounts:
Year Amount
1988 $35,324,412
1989 52,115,791
1990 54,746,820
1990 56,823,897
1992 11,914,614
Total 210,925,534
The amounts in issue are expenditures made by petitioner’s wholly
owned subsidiary, Florida Power & Light Co. (Florida Power), an
electric utility. Petitioner filed consolidated returns with
Florida Power during the years in issue. As a utility, Florida
Power was subject to the regulatory rules of the Federal Energy
Regulatory Commission (FERC) and the Florida Public Service
Commission (FPSC).
1 Unless otherwise indicated, all Rule references are to the
Tax Court Rules of Practice and Procedure, and all section
references are to the Internal Revenue Code.
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