Rev. Proc. 73-27

Section 1. Purpose.

The purpose of this Revenue Procedure is to clarify the nature and type of assets included in subclasses of 48.1, "Telephone" of class 48.0 "Communication." There is no change in the asset guideline periods, ranges, or guideline repair allowance percentages in this supplement of Rev. Proc. 72-10, 1972-1 C.B. 721.

The new description of class 48.11, "Central Office Buildings," restates the class definition to remove any unwarranted implication or possible misunderstanding that the classification of central office buildings intended to house central office equipment is controlling in the qualification of the assets for the investment tax credit.

The asset guideline depreciation period and ranges and guideline repair allowance percentage for asset guideline class 48.11 were based upon experience for assets as defined in Federal Communications Commission Part 31 account 212. Whether these assets qualified as section 1245 property or section 1250 property was not considered. Accordingly, the inclusion of assets in guideline class 48.11, "Central Office Buildings," does not define these assets as either section 1245 or section 1250 property.

Part 31 of the Federal Communications Commission Rules and Regulations prescribes a uniform system of accounts for Class A and Class B telephone companies only. Class C telephone companies have a different prescribed uniform system of accounts. Class D companies and those not subject to the jurisdiction of the Federal Communications Commission are not ordinarily required to follow any prescribed system of accounts.

Therefore, asset guideline classes 48.11, "Central Office Buildings," 48.12, "Central Office Equipment," 48.13, "Station Equipment," and 48.14, "Distribution Plant," are restated to define the assets included as those which are defined, or comparable to those defined in the appropriate accounts of Part 31 of the Federal Communications Commission Rules and Regulations regardless of the account designation used by the taxpayer.

Sec. 2. Asset Guideline Classes and Periods, Asset Depreciation Ranges, and Asset Guideline Repair Allowances for Telephone Communication.

The asset guideline classes, description of assets included, guideline periods and ranges, and repair allowance percentages have been prescribed as follows:

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Rev. Proc. 72-10 is modified by represcribed description of assets included in class 48.11, "Central Office Building," class 48.12, "Central Office Equipment," class 48.13, "Station Equipment," and class 48.14, "Distribution Plant," with prescribed asset guideline periods, ranges, and guideline repair allowance percentages.

Sec. 4. Effective Date.

The description of assets included for class 48.11, "Central Office Buildings," class 48.12, "Central Office Equipment," class 48.13, "Station Equipment," and class 48.14, "Distribution Plant" 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.

¹ Also released as Technical Information Release 1254, September 4, 1973.