Rev. Proc. 79-26
Rev. Proc. 79-26; 1979-1 C.B. 566
- Cross-Reference
26 CFR 601.105: Examination of returns and claims for refund, credit,
or abatement; determination of correct tax liability.
(Also Part I, Section 167; 1.167(a)-11.)
- Code Sections
- LanguageEnglish
- Tax Analysts Electronic Citationnot available
Superseded by Rev. Proc. 83-35 Modified by Rev. Proc. 80-33
Section 1. Purpose.
In this Revenue Procedure, the Assistant Secretary (Tax Policy) of the Treasury prescribes certain changes with respect to the Class Life Asset Depreciation Range System. One purpose of this Revenue Procedure is to establish a new asset guideline class for assets used in waste reduction and resource recovery plants, formerly included in class 39.0, an asset guideline depreciation period and range, and annual asset guideline repair allowance percentage. A further purpose is to modify the asset guideline depreciation period and range for asset guideline class 00.4, Industrial Steam and Electric Generation and/or Distribution Systems, and to prescribe other clarified asset guideline classes containing related activities. These changes are adopted pursuant to section 1.167(a)-11 of the Income Tax Regulations.
The new and clarified asset guideline classes, asset guideline depreciation periods and ranges, and annual asset guideline repair allowance percentages are set forth in Section 2 of this Revenue Procedure.
Sec. 2. Asset Guideline Classes, Asset Depreciation Periods and Ranges, and Annual Asset Guideline Repair Allowance Percentages for Assets Used In Waste Reduction and Resource Recovery Plant, Central Steam Utility Production and Distribution, Electric Utility Steam Production Plant, Gas Utility Manufactured Gas Production Plants, and Industrial Steam and Electric Generation and/or Distribution Systems.
The asset guideline classes, asset guideline depreciation periods and ranges, and annual asset guideline repair allowance percentages are prescribed as set forth below.
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Asset Depreciation
Range (in years) Annual
----------------------- Asset
Asset Asset Guideline
Guideline Description of Lower Guideline Upper Repair
Class Assets Included Limit Period Limit Allowance
Percentage
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00.4 Industrial Steam and
Electric Generation
and/or Distribution
Systems:
Includes assets,
whether such assets are
are section 1245 pro-
perty or 1250 property,
providing such assets
are depreciable, used
in the production
and/or distribution of
electricity with rated
total capacity in
excess of 500 Kilo-
watts and/or assets
used in the production
and/or distribution of
steam with rated total
capacity in excess of
12,500 pounds per hour
for use by the taxpayer
in his industrial manu-
facturing process or
plant activity and not
ordinarily available
for sale to others.
Does not include
buildings and structural
components as defined in
section 1.481(e) of the
regulations. Assets used
to generate and/or dis-
tribute electricity or
steam of the type des-
cribed above but of
lesser rated capacity
are not included, but are
included in the appro-
priate manufacturing
equipment classes else-
where specified. Also
includes electric
generating and steam
distribution assets,
which may utilize steam
produced by a waste re-
duction and resource
recovery plant, used by
the taxpayer in his
industrial manufacturing
process or plant acti-
vity. Steam and chemical
recovery boiler systems
used for the recovery
and regeneration of
chemicals used in manu-
facturing, with rated
capacity in excess of
that described above,
with specifically rela-
ted distribution and
return systems are not
included but are inclu-
ded in appropriate manu-
facturing equipment cla-
sses elsewhere speci-
fied. An example of an
excluded steam and chemi-
cal recovery boiler
system is that used in
the pulp and paper manu-
facturing industry _____ 17.5 22 26.5 2.5
49.13 Electric Utility Steam
Production Plant:
Includes assets used
in the steam power pro-
duction of electricity
for sale, combustion
turbines operated in a
combined cycle with a
conventional steam unit
and related land improve-
ments. Also includes
package boilers, electric
generators and related
assets such as electri-
city and steam distri-
bution systems as used by
a waste reduction and re-
source recovery plant if
the steam or electricity
is normally for sale to
others _________________ 22.5 28 33.5 5.0
49.221 Gas Utility Manufactured
Gas Production Plants:
Includes assets used in
the manufacture of gas
having chemical and/or
physical properties which
do not permit complete in-
terchangeability with do-
mestic natural gas. Does
not include gas producing
systems and related sys-
tems used in waste reduc-
tion and resource recove-
ry plants which are else-
where classified _______ 24 30 36 2.0
49.4 Central Steam Utility
Production and Distri-
bution:
Includes assets used
in the production and
distribution of steam
for sale. Does not in-
clude assets used in
waste reduction and re-
source recovery plants
which are elsewhere
classified _____________ 22.5 28 33.5 2.5
49.5 Waste Reduction and
Resource Recovery
Plants:
Includes assets used
in the conversion of re-
fuse or other solid waste
or biomass to heat or to
a solid, liquid, or ga-
seous fuel. Also includes
all process plant equip-
ment and structures at
the site used to receive,
handle, collect, and pro-
cess refuse or other so-
lid waste or biomass to a
solid, liquid, or gaseous
fuel or to handle and
burn refuse or other solid
waste or biomass in a wa-
terwall combustion system,
oil or gas pyrolysis sys-
tem, or refuse derived
fuel system to create hot
water, gas, steam and elec-
tricity. Includes material
recovery and support assets
used in refuse or solid
refuse or solid waste re-
ceiving, collecting, hand-
ling, sorting, shredding,
classifying, and separa-
tion systems. Does not
include any package boi-
lers, or electric gene-
rators and related assets
such as electricity, hot
water, steam and manufac-
tured gas production
plants classified in cla-
sses 00.4, 49.13, 49.221,
and 49.4. Does include,
however, all other utili-
ties such as water supply
and treatment facilities,
ash handling and other re-
lated land improvements of
a waste reduction and re-
source recovery plant ___ 8 10 12 15.0
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Sec. 3. Effect On Other Documents.
Rev. Proc. 77-10, 1977-1 C.B. 548, is modified by the establishment of the new asset guideline class 49.5, Waste Reduction and Resource Recovery Plant, with an asset guideline depreciation period, range, and annual asset guideline repair allowance percentage. This new class modifies the content of assets guideline class 39.0, Manufacture of Athletic, Jewelry and Other Goods. Rev. Proc. 77-10 is modified by the revision of guideline class 00.4, Industrial Steam and Electric Generation and/or Distribution Systems, and its asset guideline depreciation period and range, and by revisions of related activities described in guideline classes 49.13, Electric Utility Steam Production Plant, 49.221, Gas Utility Manufactured Gas Production Plants and 49.4, Central Steam Utility Production and Distribution.
Sec. 4. Effective Date.
The revisions set forth in this Revenue Procedure are effective for property first placed in service in taxable years beginning after December 31, 1978.
- Cross-Reference
26 CFR 601.105: Examination of returns and claims for refund, credit,
or abatement; determination of correct tax liability.
(Also Part I, Section 167; 1.167(a)-11.)
- Code Sections
- LanguageEnglish
- Tax Analysts Electronic Citationnot available
