Company Suggests Way to Ease Burdens Under Proposed 'Repair' Regs

Gentlemen:

After reviewing the new tangible asset regulations we have determined several issues that affect the Clearfield Bank & Trust Company and we would like to offer the following comments.

In general, these regulations are complicated and have elections in and elections out provisions, some annual, some when property placed in service, some when property disposed of. They are burdensome administratively even under the rules designed for ease of administration, taxpayers are still required to maintain records for tax purposes that are not maintained for book purposes. We will need to devote significant resources to understanding these rules and applying them annually. Even with all the complexity, the regulations retain most of the facts and circumstances determinations that led to much of the controversies between IRS and taxpayers. Their complexity and administrative burden may lead to noncompliance

On way the government could help easy the burden of these new regulation would be to implement them on a cut off method and not on a look back method. This would reduce the time necessary to look at all of the prior transactions to determine if a change is necessary.

If you have any questions, please do not hesitate to contact me.