IRS written determination 201426020

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: 201426020
Release Date: 6/27/2014
Index Number: 9100.04-00
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Third Party Communication: None
Date of Communication: Not Applicable
Person To Contact:
-----------------, ID No. ----------------
Telephone Number:
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Refer Reply To:
CC:ITA:7
PLR-148853-13
Date:
March 18, 2014
Re: Request for Extension of Time to Make the Election Not to Deduct the Additional
First Year Depreciation
P=--------------------------------------
S1=---------------------------------------------
S2=---------------------------------------------
S3=-----------------------------------------------------------
S4=----------------------------------------------
S5=------------------------------------------------
S6=---------------------------------------------------------------
S7=----------------------------------------------------
S8=----------------------------------------------------------
A=--------------
Date1=--------------------------
Dear -------------:
This letter responds to a letter dated November 14, 2013, and subsequent
correspondence, submitted by P on behalf of itself and S1, S2, S3, S4, S5, S6, S7 and
S8 (hereinafter, P, S1, S2, S3, S4, S5, S6, S7 and S8 will be collectively referred to as
Taxpayer), requesting an extension of timepursuant 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 (Code) for all classes of
qualified property placed in service in the taxable year ended Date1.
FACTS
P represents that the facts are as follows:
P is the common parent of an affiliated group of corporations, including S1, S2,
S3, S4, S5, S6, S7 and S8. The affiliated group of corporations files consolidated

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federal income tax returns on a calendar year basis. Taxpayer is a global web services
brand company. Taxpayer placed in service qualified property (as defined in
§ 168(k)(2)) during the taxable year ended Date1.
On P’s timely filed consolidated federal income tax return for the taxable year
ended Date1, Taxpayer did not claim the additional first year depreciation deduction for
all classes of qualified property it placed in service during the taxable year ended Date1.
However, Taxpayer failed to attach tothe return, as required by § 1.168(k)-1(e)(3)(ii) of
the Income Tax Regulations, the election statement not to claim the additional first year
depreciation deduction for all classes of qualified property Taxpayer placed in service
for the taxable year ended Date1.
Taxpayer retained A, an accounting firm, to prepare its federal income tax return
for the taxable year ended Date1. However, A failed to inform Taxpayer of the election
statement. Shortly after the filing of the federal income tax return forthe taxable year in
issue, A discovered that it had failed to attach the election statement to Taxpayer’s
federal tax return for such taxable year with respect to all classes of qualified property.
Thereafter, A advised Taxpayer to file this request to correct the omission.
RULING REQUESTED
Taxpayer requests an extension of time pursuant to § 301.9100-3 to make the
election not to deduct the additional first year depreciation under § 168(k) for all classes
of qualified property placed in service during the taxable year ended Date1.
LAW AND ANALYSIS
Section 168(k)(1)provides a 50-percent additional first year depreciation
deduction for qualified property placed in service in taxable year ended Date1.
Section 168(k)(2)(D)(iii) provides that a taxpayermay elect not to deduct the 50-
percent 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 (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)(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 the election not to deduct additional first
year depreciation must be made in the manner prescribed on Form 4562, “Depreciation

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and Amortization,” and its instructions. The instructions to Form 4562 for the taxable
year ended Date1 provide that the election not to deduct the additional first year
depreciation is made by attaching a statement to the taxpayer’s timely filed tax return
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 forthin §§ 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 elections
not to deduct theadditional first year depreciationunder § 168(k) for all classes of
property placed in service during the taxable year ended Date1 that qualify for additional
first year depreciation. These elections must be made by P filing an amended federal
tax return for that taxable year, with a statement indicating that Taxpayer is electing not
to deduct the additional first year depreciation for all classes of property placed in
service during that taxable year.
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. Specifically, no opinion is expressed or implied on whether any
item of depreciable property placed in service during the taxable year ended Date1 is
eligible for the additional first year depreciation deduction.
This ruling is directed only to the taxpayer requesting it. Section 6110(k)(3)
provides that it may not be used or cited as precedent.

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In accordance with the power of attorney, we are sending a copy of this letter to
Taxpayer’s authorized representatives. We are also sending a copy of this letter to the
appropriate Industry Director, Large Business & International Division (LB&I).
Sincerely,
WILLE 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