Rev. Proc. 73-3
Rev. Proc. 73-3; 1973-1 C.B. 749
- Cross-Reference
(Also Part I, Section 167.)
- Code Sections
- LanguageEnglish
- Tax Analysts Electronic Citationnot available
Superseded by Rev. Proc. 77-10
Section 1. Purpose
The purpose of this Revenue Procedure is to prescribe under section 1.167(a)-11 and section 1.167(a)-12 of the Income Tax Regulations new supplementary asset guideline classes and asset depreciation periods and ranges for assets used in the provision of communication services by radio-telegraph, wire-telegraph, ocean cable, and satellite communication carriers.
Revenue Procedure 62-21, 1962-2 C.B. 418, permitted the use of depreciable lives or depreciation rates established by the Federal Communications Commission and other governmental regulatory agencies to be used in the computation of depreciation for tax purposes. Revenue Procedures 71-25, 1971-2 C.B. 553, and 72-10, 1972-1 C.B. 721, did not contain asset guideline classes for these assets. This Revenue Procedure permits the use of the Class Life ADR System in the determination of depreciation for these assets for tax purposes, and provides asset guideline classes and asset guideline periods and ranges for that purpose. The asset guideline periods and ranges established by this Revenue Procedure are based upon studies of the actual anticipated periods of use for the assets included in these classes.
Section 2. Asset Guideline Classes and Periods and Asset Depreciation Ranges, for Telegraph and Satellite Communications
The asset guideline classes, periods, and ranges have been established as set forth below.
Annual
Asset Depreciation Asset
Asset Range (in years) Guide-
Guide- ---------------------- line
line Description of Assets Asset Repair
Class Included Lower Guide- Upper Allow-
limit line limit ance
Period Percent-
age
---------------------------------------------------------------------
48.3 Telegraph, Ocean Cable, and
Satellite Communications
Includes communications-
related assets used to
provide domestic and
international radio-
telegraph, wire-telegraph,
ocean-cable, and satellite
communications services.
48.31 Electric Power Generating
and Distribution Systems ___ 15.0 19.0 23.0 --
Includes assets used in the
provision of electric power
by generation, modulation,
rectification,
channelization, control,
and distribution. Does not
include these assets when
they are installed on
customers' premises.
48.32 High Frequency Radio and
Microwave Systems __________ 10.5 13.0 15.5 --
Includes assets such as
transmitters and receivers,
antenna supporting
structures, antennas,
transmission lines from
equipment to antenna,
transmitter cooling
systems, and control and
amplification equipment.
Does not include cable and
long-line systems.
48.33 Cable and Long-line
Systems ____________________ 21.0 26.5 32.0 --
Includes assets such as
transmission lines, pole
lines, ocean cables,
buried cable and conduit,
repeaters, repeater
stations, and other related
assets. Does not include
high frequency radio or
microwave systems.
48.34 Central Office Control
Equipment __________________ 13.0 16.5 20.0 --
Includes assets for general
control, switching, and
monitoring of
communications signals
including electromechanical
switching and channeling
apparatus, multiplexing
equipment, patching and
monitoring facilities, in-
house cabling, teleprinter
equipment, and associated
site improvements.
48.35 Computerized Switching,
Channeling, and Associated
Control Equipment __________ 8.5 10.5 12.5 --
Includes central office
switching computers,
interfacing computers,
other associated
specialized control
equipment, and site
improvements.
48.36 Satellite Ground Segment
Property ___________________ 8.0 10.0 12.0 --
Includes assets such as
fixed earth station
equipment, antennas,
satellite communications
equipment, and interface
equipment. Does not include
general purpose equipment
or equipment used in
satellite space segment
property.
48.37 Satellite Space Segment
Property ___________________ 6.5 8.0 9.5 --
Includes satellites and
equipment used for
telemetry, tracking,
control, and monitoring.
48.38 Equipment Installed on
Customer's Premises ________ 8.0 10.0 12.0 --
Includes assets installed
on customer's premises,
such as computers, terminal
equipment, power generation
and distribution systems,
private switching center,
teleprinters, facsimile
equipment, and other
associated and related
equipment.
48.39 Support and Service
Equipment __________________ 11.0 13.5 16.0 --
Includes assets used to
support but not engage in
communications. Includes
store, warehouse, shop,
tools, and test and
laboratory assets.
---------------------------------------------------------------------
Section 3. Effect on Other Documents
Revenue Procedure 72-10 is supplemented by the addition of the newly established classes, guideline periods and ranges as set forth in Section 2.
Section 4. Effective Date
The asset guideline periods and ranges for classes 48.31 through 48.39 inclusive 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 Revenue Procedure 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 such 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 of the regulations 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 1224, dated December 29, 1972.
- Cross-Reference
(Also Part I, Section 167.)
- Code Sections
- LanguageEnglish
- Tax Analysts Electronic Citationnot available
