IRS written determination 201519026

Private letter rulings and published taxpayer determination letters. Native document type is retained separately; a determination letter is not labeled a private letter ruling. These taxpayer-specific releases cannot be used or cited as precedent under 26 USC 6110(k)(3); applicability and current legal force are not independently certified. Keep repeated UILC subjects attached to one actual numbered document.

Internal Revenue Service
Department of the Treasury
Washington, DC 20224
Number: 201519026
Release Date: 5/8/2015
Index Number: 9100.04-00
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Third Party Communication: None
Date of Communication: Not Applicable
Person To Contact:
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Telephone Number:
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Refer Reply To:
CC:ITA:7
PLR-145223-14
Date:
January 28, 2015
Re: Request for Extension of Time to Make the Election Not to Deduct the Additional
First Year Depreciation
Legend
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Date1=--------------------------
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Dear ----------------:
This letter responds to a letter dated December 11, 2014, and supplemental
correspondence submitted, by Parent on behalf of itself and its subsidiaries S1, S2, and
S3 (hereinafter Parent and SI, S2, and S3 will be collectively referred to as “Taxpayer”),
requesting an extension of time pursuant to § 301.9100-3 of the Procedure and
Administration Regulations to make the election not to deduct the additional first year
depreciation under § 168(k) of the Internal Revenue Code. Parent submitted the

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request for itself for all classes of qualified property placed in service in taxable years
ended Date1, Date2, and Date3, for S1 and S2 for all classes of qualified property
placed in service in the taxable year ended Date1, and for S3 for all classes of qualified
property placed in service in the taxable year ended Date2.
FACTS
Parent represents that the facts are as follows:
Parent is the parent of an affiliated group that includes S1, S2, and S3. The
affiliated group files consolidated federal income tax returns on a calendar-year basis.
Parent timely filed its consolidated federal income tax returns for the taxable years
ended Date1, Date2, and Date3. The period of limitation on assessment under
§ 6501(a) for each of these taxable years has not expired.
Parent’s core business is A. Parent is governed by the rules applicable to
cooperatives that were in effect prior to the enactment of subchapter T of the Code
under the Revenue Act of 1962, Pub. L. 87-834, 76 Stat. 960.
On each of the consolidated federal income tax returns for the taxable years
ended Date1, Date2, and Date3, Parent did not claim the additional first year
depreciation deduction for any classes of qualified property placed in service by Parent
during each of those taxable years. On the consolidated federal income tax return for
the taxable year ended Date1, Parent did not claim on behalf of S1 and S2 the
additional first year depreciation deduction for any classes of qualified property placed
in service by S1 and S2 during this taxable year. Similarly, on the consolidated federal
income tax return for the taxable year ended Date2, Parent did not claim on behalf of S3
the additional first year depreciation deduction for any classes of qualified property
placed in service by S3 during this taxable year.
Parent, however, inadvertently failed to attach the election statement not to claim
the additional first year depreciation deduction for all classes of qualified property
placed in service by Taxpayer, as required by § 1.168(k)-1(e)(3)(ii) of the Income Tax
Regulations, to the consolidated federal income tax returns for the taxable years ended
Date1, Date2, and Date3.
While preparing the consolidated federal income tax return for the taxable year
ended Date4, Parent discovered that it had failed to attach the election statements to
the consolidated federal income tax returns for the taxable years ended Date1, Date2,
and Date3, with respect to all classes of qualified property.
RULING REQUESTED

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Taxpayer requests a ruling pursuant to §§ 301.9100-1 and 301.9100-3 that it be
granted an extension of time to make an election under §168(k)(2)(D)(iii) not to deduct
the additional first-year depreciation under §168(k) for Parent for all classes of qualified
property placed in service in taxable years ended Date1, Date2, and Date3, for S1 and
S2 for all classes of qualified property placed in service in the taxable year ended
Date1, and for S3 for all classes of qualified property placed in service in the taxable
year ended Date2.
LAW AND ANALYSIS
Section 168(k)(1) provides a 50-percent additional first year depreciation
deduction for the placed-in-service year for qualified property (i) acquired by a taxpayer
after 2007, and before September 9, 2010, or acquired by a taxpayer generally after
December 31, 2011, and (ii) placed in service by the taxpayer before January 1, 2015
(or January 1, 2016, for qualified property described in §168(k)(2)(B) or (C)).
Section 168(k)(5) provides a 100-percent additional first year depreciation
deduction the placed-in-service year for qualified property acquired by a taxpayer after
September 8, 2010, and before January 1, 2012, and placed in service by the taxpayer
before January 1, 2012 (or January 1, 2013, for qualified property described in
§ 168(k)(2)(B) and (C)). See section 3 of Rev. Proc. 2011-26, 2011-16 I.R.B. 664, 665.
Section 168(k)(2)(D)(iii) provides that a taxpayer may elect not to deduct
additional first year depreciation for any class of property placed in service during the
taxable year. The term "class of property" is defined in § 1.168(k)-1(e)(2) as meaning, in
general, each class of property described in § 168(e) (for example, 5-year property).
See section 5.01 of Rev. Proc. 2008-54, 2008-2 C.B. 722, and section 3.01 of Rev.
Proc. 2011-26, 2011-16 I.R.B. at 665 (rules similar to the rules in § 1.168(k)-1 for
"qualified property" or for "30-percent additional first year depreciation deduction" apply
for purposes of § 168(k) as currently in effect).
Section 1.168(k)-1(e)(1) provides that theelection not to deduct additional first
year depreciation for a class of property applies to all qualified property that is in that
class of property and placed in service in the same taxable year.
Section 1.168(k)-1(e)(3)(i) provides that the election not to deduct additional first
year depreciation must be made by the due date (including extensions) of the federal
tax return for the taxable year in which the property is placed in service by the taxpayer.
Section 1.168(k)-1(e)(3)(ii) provides that theelection not to deduct additional first
year depreciation must be made in the manner prescribed on Form 4562, "Depreciation
and Amortization," and its instructions. The instructions to Form 4562 for the taxable
years ended Date1, Date2, and Date3 providedthat the election not to deduct the
additional first year depreciation is made by attaching a statement to the taxpayer's

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timely filed tax return (including extensions) indicating that the taxpayer is electing not to
deduct the additional first year depreciation and the class of property for which the
taxpayer is making the election.
Under § 301.9100-1, the Commissioner has discretion to grant a reasonable
extension of time under the rules set forth in § 301.9100-2 and 301.9100-3 to make a
regulatory election.
Sections 301.9100-1 through 301.9100-3 provide the standards the
Commissioner will use to determine whether to grant an extension of time to make an
election. Section 301.9100-2 provides automatic extensions of time for making certain
elections. Section 301.9100-3 provides extensions of time for making elections that do
not meet the requirements of § 301.9100-2.
Section 301.9100-3(a) provides that requests for relief under § 301.9100-3 will be
granted when the taxpayer provides evidence to establish to the satisfaction of the
Commissioner that the taxpayer acted reasonably and in good faith, and the grant of
relief will not prejudice the interests of the government.
CONCLUSIONS
Based solely on the facts and representations submitted, we conclude that the
requirements of §§ 301.9100-1 and 301.9100-3 have been satisfied. Accordingly,
Taxpayer is granted 60 calendar days from the date of this letter to make the election
not to deduct the additional first-year depreciation deduction under § 168(k)for Parent
for all classes of qualified property placed in service in taxable years ended Date1,
Date2, and Date3, for S1 and S2 for all classes of qualified property placed in service in
the taxable year endedDate1, and for S3 for all classes of qualified property placed in
service in the taxable year ended Date2. This election must be made by Parent filing
amended consolidated federal income tax returns for such taxable years, with a
statement indicating that: (1) Parent is electing not to deduct the additional first year
depreciation for all classes of qualified property placed in service in taxable years ended
Date1, Date2, and Date3; (2) S1 and S2 are electing not to deduct the additional first
year depreciation for all classes of qualified property placed in service in the taxable
year ended Date 1; and (3) S3 is electing not to deduct the additional first year
depreciation deduction for all classes of qualified property placed in service in the
taxable year ended Date 2.
Except as specifically set forth above, we express no opinion concerning the
federal income tax consequences of the facts described above under any other
provisions of the Code (including other subsections of § 168). Specifically, no opinion is
expressed or implied on whether any item of depreciable property placed in service by

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Taxpayer during the taxable years ended Date1, Date2, or Date3, is eligible for the
additional first year depreciation deduction.
In accordance with the power ofattorney, we are sending a copy of this letter to
Taxpayer's authorized representatives.
This letter ruling is directed only to the taxpayer requesting it. Section 6110(k)(3)
provides that it may not be used or cited as precedent.
Sincerely,
Willie E. Armstrong, Jr.
WILLIE E. ARMSTRONG, JR.
Senior Technician Reviewer, Branch 7
Office of Associate Chief Counsel
(Income Tax and Accounting)
Enclosures (2):
copy of this letter
copy for section 6110 purposes