Rev. Proc. 73-23

Section 1. Purpose.

The purpose of this Revenue Procedure is to include under section 1.167(a)-11 and section 1.167(a)-12 of the Income Tax Regulations the assets in Interstate Commerce Commission Account 25, TOFC/COFC terminals, and Interstate Commerce Commission Account 58, Miscellaneous equipment, and clarify the classification of assets in Interstate Commerce Commission Account 55, Highway revenue equipment, under guideline class 40.0 "Railroad Transportation."

This Revenue Procedure permits the use of the Class Life ADR System in the determination of depreciation for tax purposes for railroad transportation assets which were included under Rev. Proc. 62-21, 1962-2 C.B. 418, on December 31, 1970 but not included under Rev. Proc. 71-25, 1971-2 C.B. 553, and Rev. Proc. 72-10, 1972-1 C.B. 721, because of the reclassification of these assets into new Interstate Commerce Commission accounts on January 1, 1971. A clarifying statement on the exclusion of transportation assets included in asset guideline class 00.2, "Transportation Equipment," is now provided to assure that transportation assets such as trucks, buses, airplanes, etc., presently included in Interstate Commerce Commission Accounts 55 and 58 are to be included and depreciated in the appropriate guideline classes of 00.2, "Transportation Equipment," under the Class Life Asset Depreciation Range System.

Sec. 2. Asset Guideline Classes and Periods, Asset Depreciation Ranges, and Asset Guideline Repair Allowances for Railroad Transportation.

The asset guideline classes, to the extent that they are herein amended, periods, ranges and repair allowance percentages are prescribed below. There is no change in the asset guideline periods, ranges or repair allowance percentages.

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Rev. Proc. 72-10 is modified by the inclusion of designated Interstate Commerce Commission Accounts and clarified by the classification of transportation assets under asset guideline class 40.0 "Railroad Transportation."

Sec. 4. Effective Date.

The asset guideline periods, ranges and repair allowance percentages for class 40.0, "Railroad Transportation." are effective for the property and the taxable years to which sections 1.167(a)-11 and 1.167(a)-12 of the regulations respectively apply. However, the taxpayer may at his option apply Rev. Proc. 72-10 without regard to this supplement for property placed in service in any such year beginning prior to January 1, 1973. Such option may be exercised for one year and not for another or for all such years. The option shall be exercised in making the election to apply section 1.167(a)-11 or section 1.167(a)-12 for such year and may not be revoked after the latest time for making such election and shall apply only with respect to the section for which exercised.

¹ Also released as Technical Information Release 1250, dated September 4, 1973.