26 U.S.C. § 169 : US Code - Section 169: Amortization of pollution control facilities

Search 26 U.S.C. § 169 : US Code - Section 169: Amortization of pollution control facilities

(a) Allowance of deduction
Every person, at his election, shall be entitled to a deduction
with respect to the amortization of the amortizable basis of any
certified pollution control facility (as defined in subsection
(d)), based on a period of 60 months. Such amortization deduction
shall be an amount, with respect to each month of such period
within the taxable year, equal to the amortizable basis of the
pollution control facility at the end of such month divided by the
number of months (including the month for which the deduction is
computed) remaining in the period. Such amortizable basis at the
end of the month shall be computed without regard to the
amortization deduction for such month. The amortization deduction
provided by this section with respect to any month shall be in lieu
of the depreciation deduction with respect to such pollution
control facility for such month provided by section 167. The 60-
month period shall begin, as to any pollution control facility, at
the election of the taxpayer, with the month following the month in
which such facility was completed or acquired, or with the
succeeding taxable year.
(b) Election of amortization
The election of the taxpayer to take the amortization deduction
and to begin the 60-month period with the month following the month
in which the facility is completed or acquired, or with the taxable
year succeeding the taxable year in which such facility is
completed or acquired, shall be made by filing with the Secretary,
in such manner, in such form, and within such time, as the
Secretary may by regulations prescribe, a statement of such
election.
(c) Termination of amortization deduction
A taxpayer which has elected under subsection (b) to take the
amortization deduction provided in subsection (a) may, at any time
after making such election, discontinue the amortization deduction
with respect to the remainder of the amortization period, such
discontinuance to begin as of the beginning of any month specified
by the taxpayer in a notice in writing filed with the Secretary
before the beginning of such month. The depreciation deduction
provided under section 167 shall be allowed, beginning with the
first month as to which the amortization deduction does not apply,
and the taxpayer shall not be entitled to any further amortization
deduction under this section with respect to such pollution control
facility.
(d) Definitions and special rules
For purposes of this section -
(1) Certified pollution control facility
The term "certified pollution control facility" means a new
identifiable treatment facility which is used, in connection with
a plant or other property in operation before January 1, 1976, to
abate or control water or atmospheric pollution or contamination
by removing, altering, disposing, storing, or preventing the
creation or omission of pollutants, contaminants, wastes, or heat
and which -
(A) the State certifying authority having jurisdiction with
respect to such facility has certified to the Federal
certifying authority as having been constructed, reconstructed,
erected, or acquired in conformity with the State program or
requirements for abatement or control of water or atmospheric
pollution or contamination;
(B) the Federal certifying authority has certified to the
Secretary (i) as being in compliance with the applicable
regulations of Federal agencies and (ii) as being in
furtherance of the general policy of the United States for
cooperation with the States in the prevention and abatement of
water pollution under the Federal Water Pollution Control Act,
as amended (33 U.S.C. 466 et seq.), or in the prevention and
abatement of atmospheric pollution and contamination under the
Clean Air Act, as amended (42 U.S.C. 1857 et seq.); and
(C) does not significantly -
(i) increase the output or capacity, extend the useful
life, or reduce the total operating costs of such plant or
other property (or any unit thereof), or
(ii) alter the nature of the manufacturing or production
process or facility.
(2) State certifying authority
The term "State certifying authority" means, in the case of
water pollution, the State water pollution control agency as
defined in section 13(a) of the Federal Water Pollution Control
Act and, in the case of air pollution, the air pollution control
agency as defined in section 302(b) of the Clean Air Act. The
term "State certifying authority" includes any interstate agency
authorized to act in place of a certifying authority of the
State.
(3) Federal certifying authority
The term "Federal certifying authority" means, in the case of
water pollution, the Secretary of the Interior and, in the case
of air pollution, the Secretary of Health and Human Services.
(4) New identifiable treatment facility
(A) In general
For purposes of paragraph (1), the term "new identifiable
treatment facility" includes only tangible property (not
including a building and its structural components, other than
a building which is exclusively a treatment facility) which is
of a character subject to the allowance for depreciation
provided in section 167, which is identifiable as a treatment
facility, and which is property -
(i) the construction, reconstruction, or erection of which
is completed by the taxpayer after December 31, 1968, or
(ii) acquired after December 31, 1968, if the original use
of the property commences with the taxpayer and commences
after such date.
In applying this section in the case of property described in
clause (i) there shall be taken into account only that portion
of the basis which is properly attributable to construction,
reconstruction, or erection after December 31, 1968.
(B) Certain facilities placed in operation after April 11, 2005
In the case of any facility described in paragraph (1) solely
by reason of paragraph (5), subparagraph (A) shall be applied
by substituting "April 11, 2005" for "December 31, 1968" each
place it appears therein.
(5) Special rule relating to certain atmospheric pollution
control facilities
In the case of any atmospheric pollution control facility which
is placed in service after April 11, 2005, and used in connection
with an electric generation plant or other property which is
primarily coal fired -
(A) paragraph (1) shall be applied without regard to the
phrase "in operation before January 1, 1976", and
(B) in the case of facility (!1) placed in service in
connection with a plant or other property placed in operation
after December 31, 1975, this section shall be applied by
substituting "84" for "60" each place it appears in subsections
(a) and (b).
(e) Profitmaking abatement works, etc.
The Federal certifying authority shall not certify any property
under subsection (d)(1)(B) to the extent it appears that by reason
of profits derived through the recovery of wastes or otherwise in
the operation of such property, its costs will be recovered over
its actual useful life.
(f) Amortizable basis
(1) Defined
For purposes of this section, the term "amortizable basis"
means that portion of the adjusted basis (for determining gain)
of a certified pollution control facility which may be amortized
under this section.
(2) Special rules
(A) If a certified pollution control facility has a useful
life (determined as of the first day of the first month for
which a deduction is allowable under this section) in excess of
15 years, the amortizable basis of such facility shall be equal
to an amount which bears the same ratio to the portion of the
adjusted basis of such facility, which would be eligible for
amortization but for the application of this subparagraph, as
15 bears to the number of years of useful life of such
facility.
(B) The amortizable basis of a certified pollution control
facility with respect to which an election under this section
is in effect shall not be increased, for purposes of this
section, for additions or improvements after the amortization
period has begun.
(g) Depreciation deduction
The depreciation deduction provided by section 167 shall, despite
the provisions of subsection (a), be allowed with respect to the
portion of the adjusted basis which is not the amortizable basis.
[(h) Repealed. Pub. L. 92-178, title I, Sec. 104(f)(2), Dec. 10,
1971, 85 Stat. 502]
(i) Life tenant and remainderman
In the case of property held by one person for life with
remainder to another person, the deduction under this section shall
be computed as if the life tenant were the absolute owner of the
property and shall be allowable to the life tenant.
(j) Cross reference
For special rule with respect to certain gain derived from
the disposition of property the adjusted basis of which is
determined with regard to this section, see section 1245.