REV-PROC, Accelerated cost recovery: Recovery classes: Class lives: Recovery periods.--, Revenue Procedure 87-56, (Jan. 01, 1987)
Revenue Procedure 87-56, 

Accelerated cost recovery: Recovery classes: Class lives: Recovery periods.--Recovery classes, class lives, and recovery periods for assigned property are added by the Tax Reform Act of 1986. BACK REFERENCES: 87FED ¶1732A, 87FED ¶1732D.0045, 87FED ¶1732D.008, 87FED ¶1732D.08, 87FED ¶1732D.16, 87FED ¶1825.01 and 87FED ¶2732D.007.

SECTION 1. PURPOSE

The purpose of this revenue procedure is to set forth the class lives of property that are necessary to compute the depreciation allowances available under section 168 of the Internal Revenue Code, as amended by section 201(a) of the Tax Reform Act of 1986 (Act), 1986-3 (Vol. 1) C.B. 38. Rev. Proc. 87-57, page 687, this Bulletin, describes the applicable depreciation methods, applicable recovery periods, and applicable conventions that must be used in computing depreciation allowances under section 168.

SEC. 2. GENERAL RULES OF APPLICATION

.01 In general. This revenue procedure specifies class lives and recovery periods for property subject to depreciation under the general depreciation system provided in section 168(a) of the Code or the alternative depreciation system provided in section 168(g).

.02 Definition of Class Life. Except with respect to certain assigned property described in section 3 of this revenue procedure, for purposes of both the general depreciation system and the alternative depreciation system, the term “class life” means the class life that would be applicable for any property as of January 1, 1986, under section 167(m) of the Code (determined without regard to paragraph 4 thereof and determined as if the taxpayer had made an election under section 167(m)). The class life that would be applicable for any property as of January 1, 1986, under section 167(m), is the asset guideline period (midpoint class life) for the asset guideline class in which such property is classified under Rev. Proc. 83-35, 1983-1 C.B. 745. However, for purposes of the alternative depreciation system, section 168(g)(3)(B) assigns a class life to certain property that is taken into account under section 168 rather than the class life that would be applicable as of January 1, 1986. The class life of property that is either determined as of January 1, 1986, under Rev. Proc. 83-35 or assigned under section 168(g)(3)(B) may be modified by the Secretary pursuant to authority granted under section 168(i)(1). See section 4 of this revenue procedure.

.03 Rev. Proc. 83-35. Rev. Proc. 83-35 sets out the asset guideline classes, asset guideline periods and ranges, and annual asset guideline repair allowance percentages for the Class Life Asset Depreciation Range System. The asset guideline periods (midpoint class lives) set out in Rev. Proc. 83-35 are also used in defining the classes of recovery property under the Accelerated Cost Recovery System (that is, section 168 of the Code as in effect prior to amendment by section 201 of the Act). Rev. Proc. 83-35 remains effective for property subject to depreciation under those systems. Rev. Proc. 83-35 does not apply to property subject to depreciation under section 168, other than as a basis for determining the class lives of such property under section 2.02 of this revenue procedure.

.04 Property with no class life. Property that is neither described in an asset guideline class listed in section 5 of this revenue procedure nor assigned a class life under section 168(g)(3)(B) of the Code is treated as property having no class life for purposes of section 168 unless and until a class life is prescribed by the Secretary pursuant to the authority granted under section 168(i)(1). See section 4 of this revenue procedure. The general and alternative depreciation systems contain separate rules for classifying property that does not have a class life.

SEC. 3. ASSIGNED PROPERTY WITH ASSIGNED CLASS LIVES, RECOVERY CLASSES, OR RECOVERY PERIODS

Under section 168(i)(1)(E) of the Code, the term “assigned property” means property for which a class life, recovery class, or recovery period is assigned under section 168(e)(3) or section 168(g)(3)(B), (C), or (D), and the term “assigned item” means the class life, recovery class, or recovery period assigned under section 168(e)(3) or section 168(g)(3)(B), (C), or (D). For purposes of the general depreciation system assigned property under section 168(e)(3) is assigned to a recovery class without regard to such property’s class life. (See section 3.02 of Rev. Proc. 87-57, this Bulletin.) For purposes of the alternative depreciation system, certain assigned property is assigned a class life under section 168(g)(3)(B), notwithstanding such property’s class life as set out in Rev. Proc. 83-35. See section 3.03 of Rev. Proc. 87-57, this Bulletin. For purposes of the alternative depreciation system, certain assigned property is assigned a recovery period under section 168(g)(3)(C), (D), or (E), notwithstanding such property’s class life (if any).

SEC. 4. PRESCRIPTION AND MODIFICATION OF CLASS LIVES

.01 Section 168(i)(1)(B) of the Code provides that the Secretary, through an office established in the Treasury, shall monitor and analyze actual experience with respect to all depreciable assets. Except in the case of section 1250 property that is residential rental property or nonresidential real property, the Secretary, through that office, (i) may prescribe a new class life for any property, (ii) in the case of assigned property, may modify any assigned item, or (iii) may prescribe a class life for any property that does not have a class life within the meaning of section 2.02 of this revenue procedure. Any class life or assigned item that is prescribed or modified pursuant to this authority shall be used for all purposes in determining depreciation allowances under the general depreciation system and the alternative depreciation system. In the case of assigned property as defined in section 168(i)(1)(E), no class life set forth in this revenue procedure nor any other assigned item may be modified, unless such modification reflects a shortening of such class life, for property placed in service prior to January 1, 1992.

.02 Prescription or modification of class lives under the authority granted in section 168(i)(1)(B) of the Code shall reflect the anticipated useful lives, and the anticipated decline in value over time (that is, economic depreciation) of an asset to the industry or other group. Rules and practices governing prescription and modification of class lives pursuant to the authority granted in section 168(i)(1)(B) shall be announced through the office referred to in section 4.01 of this revenue procedure.

SEC. 5. TABLES OF CLASS LIVES AND RECOVERY PERIODS

.01 Except for property described in section 5.02, below, the class lives (if any) and recovery periods for property subject to depreciation under section 168 of the Code appear in the tables below. These tables are based on the definition of class life in section 2.02 of this revenue procedure and the assigned items described in section 3 of this revenue procedure.

.02 For purposes of depreciation under the general depreciation system, residential rental property has a recovery period of 27.5 years and nonresidential real property has a recovery period of 31.5 years. For purposes of the alternative depreciation system, residential rental and nonresidential real property each has a recovery period of 40 years.

Under section 168(e)(2)(B)(ii) of the Code, “nonresidential real property” does not include any property described in an asset class with a class life of less than 27.5 years. Even if nonresidential real property is described in an asset class with a class life of 27.5 years or more, the applicable recovery period for that property is 31.5 years for purposes of the general depreciation system and 40 years for purposes of the alternative depreciation system, regardless of the applicable recovery periods set out for the asset class in the tables below.

.03 Generally, the asset classes in the tables are incorporated from the asset guideline classes in Rev. Proc. 83-35 as of January 1, 1986. However, descriptions of the following asset classes have been amended or added: 00.12, 00.3, 01.221--01.225, 01.3, 01.4, 36.0, 36.1, 40.4, 48.12, 48.121, 48.31-48.45, 50, and 51. Certain asset guideline classes in Rev. Proc. 83-35 included property on the basis of regulated accounts. For purposes of section 168 of the Code and this revenue procedure, asset classes include property described therein without regard to whether a taxpayer is a regulated public utility or an unregulated company.

.04 In addition to specifying class lives for each asset guideline class, the tables list certain property for which a recovery period is assigned, notwithstanding such property’s class life (if any). See section 3 of this revenue procedure. The listed assigned property classes (denoted A-E) generally do not correspond to asset guideline classes for which class lives are specified in the tables. The class life (if any) of an item of assigned property described in classes A-E is determined by reference to the asset guideline class (if any) containing such item of property. If an item of assigned property described in classes A-E is not contained in any asset guideline class, such item of property has no class life.

Examples. Qualified technological equipment as defined in section 168(i)(2) (class B) is assigned a recovery period of 5 years for both the general and alternative depreciation systems, notwithstanding such property’s class life (if any). Property which is a computer or peripheral equipment, high technology telephone station equipment installed on the customer’s premises or high technology medical equipment within the meaning of section 168(i)(2), may be described in asset guideline class 00.12 (class life 6 years), 48.13 (class life 10 years) or 57.0 (class life 9 years), respectively. Property used in connection with research and experimentation referred to in section 168(e)(3)(B) (class C) is assigned a recovery period of 5 years for the general depreciation system, notwithstanding its class life (if any). Such property’s recovery period for the alternative depreciation system is based on its class life (if any). An item of property used in connection with research and experimentation has a class life if such property is contained in an asset guideline class.

.05 The following special rules are incorporated from Rev. Proc. 83-35, sections 2.02(iii) and (iv):

1 Asset guideline class 00.3, “Land Improvements,” includes “other tangible property” that qualifies under section 1.48-1(d) of the Income Tax Regulations. However, a structure that is essentially an item of machinery or equipment or a structure that houses property used as an integral part of an activity specified in section 48(a)(1)(B)(i) of the Code, if the use of the structure is so closely related to the use of the property that the structure clearly can be expected to be replaced when the property it initially houses is replaced, is included in the asset guideline class appropriate to the equipment to which it is related.

2 Asset class 30.11 includes general rebuilding or rehabilitation costs for the special tools defined in class 30.11 that have been traditionally capitalized as the cost of a new asset.

SEC. 6. EFFECT ON OTHER REVENUE PROCEDURES

Rev. Proc. 83-35 is obsoleted for property that is subject to section 168 of the Code.
                                                Recovery Periods
(in years)
                                       Alter-
                             General   native

                                                          Depre-
Asset                                        Class Life   ciation   ciation
class   Description of assets included       (in years)   System     System

SPECIFIC DEPRECIABLE ASSETS USED IN ALL BUSINESS ACTIVITIES,

EXCEPT AS NOTED:
						                           Class Life        MACRS

00.11  Office Furniture, Fixtures, and Equipment: 
       Includes furniture and fixtures that are
       not a structural component of a building.
       Includes such assets as desks, files,
       safes, and communications equipment. Does
       not include communications equipment that
       is included in other classes.............. 10         7        

00.12  Information Systems:
       Includes computers and their peripheral
       equipment used in administering normal
       business transactions and the maintenance
       of business records, their retrieval and
       analysis. Information systems are defined
       as:

       1) Computers: A computer is a programmable
       electronically activated device capable of
       accepting information, applying prescribed
       processes to the information, and supplying
       the results of these processes with or
       without human intervention. It usually
       consists of a central processing unit
       containing extensive storage, logic,
       arithmetic, and control capabilities.

       Excluded from this category are adding
       machines, electronic desk calculators,
       etc., and other equipment described in
       class 00.13.

       2) Peripheral equipment consists of the
       auxiliary machines which are designed to
       be placed under control of the central
       processing unit. Nonlimiting examples are:
       Card readers, card punches, magnetic tape
       feeds, high speed printers, optical
       character readers, tape cassettes, mass
       storage units, paper tape equipment,
       keypunches, data entry devices,
       teleprinters, terminals, tape drives,
       disc drives, disc files, disc packs,
       visual image projector tubes, card sorters,
       plotters, and collators. Peripheral
       equipment may be used on-line or off-line.

       Does not include equipment that is an
       integral part of other capital equipment
       that is included in other classes of
       economic activity, i.e., computers used
       primarily for process or production
       control, switching, channeling, and
       automating distributive trades and services
       such as point of sale (POS) computer
       systems. Also, does not include equipment
       of a kind used primarily for amusement or
       entertainment of the user.................. 6         5 *       5 *
* Property described in asset class 00.12 which is qualified technological equipment as defined in section 168(i)(2) is assigned a recovery period of 5 years notwithstanding its class life. See section 3 of the revenue procedure.

00.13  Data Handling Equipment, except Computers:

       Includes only typewriters, calculators,
       adding and accounting machines, copiers,
       and duplicating equipment.................. 6         5         

00.21  Airplanes (airframes and engines), except
       those used in commercial or contract
       carrying of passengers or freight, and all
       helicopters (airframes and engines)........ 6         5         

00.22  Automobiles, Taxis......................... 3         5         

00.23  Buses...................................... 9         5         

00.241 Light General Purpose Trucks:
       Includes trucks for use over the road
       (actual unloaded weight less than 13,000
       pounds).................................... 4         5         

00.242 Heavy General Purpose Trucks:

       Includes heavy general purpose trucks,
       concrete ready mix truckers, and ore
       trucks, for use over the road (actual

       unloaded weight 13,000 pounds or more)..... 6         5         

00.25  Railroad Cars and Locomotives, except
       those owned by railroad transportation
       companies................................. 15         7        5

00.26  Tractor Units For Use Over-The-Road........ 4         3         

00.27  Trailers and Trailer-Mounted Containers.... 6         5         

00.28  Vessels, Barges, Tugs, and Similar Water
       Transportation Equipment, except those used
       in marine construction.................... 18        10        

00.3   Land Improvements:
       Includes improvements directly to or added
       to land, whether such improvements are
       section 1245 property or section 1250
       property, provided such improvements are
       depreciable. Examples of such assets might
       include sidewalks, roads, canals,
       waterways, drainage facilities, sewers (not
       including municipal sewers in Class 51),
       wharves and docks, bridges, fences,
       landscaping, shrubbery, or radio and
       television transmitting towers. Does not
       include land improvements that are
       explicitly included in any other class,
       and buildings and structural components as
       defined in section 1.48-1(e) of the
       regulations. Excludes public utility
       initial clearing and grading land
       improvements as specified in Rev. Rul.
       72-403, 1972-2 C.B. 102................... 20        15        

00.4   Industrial Steam and Electric Generation
       and/or Distribution Systems:
       Includes assets, whether such assets are
       section 1245 property or 1250 property,
       providing such assets are depreciable, used
       in the production and/or distribution of
       electricity with rated total capacity in
       excess of 500 Kilowatts and/or assets used
       in the production and/or distribution of
       steam with rated total capacity in excess
       of 12,500 pounds per hour for use by the
       taxpayer in its industrial manufacturing
       process or plant activity and not
       ordinarily available for sale to others.
       Does not include buildings and structural
       components as defined in section 1.48-1(e)
       of the regulations. Assets used to generate
       and/or distribute electricity or steam of
       the type described above but of lesser
       rated capacity are not included, but are
       included in the appropriate manufacturing
       equipment classes elsewhere specified. Also
       includes electric generating and steam
       distribution assets, which may utilize
       steam produced by a waste reduction and
       resource recovery plant, used by the
       taxpayer in its industrial manufacturing
       process or plant activity. Steam and
       chemical recovery boiler systems used for
       the recovery and regeneration of chemicals
       used in manufacturing, with rated capacity
       in excess of that described above, with
       specifically related distribution and
       return systems are not included but are
       included in appropriate manufacturing
       equipment classes elsewhere specified. An
       example of an excluded steam and chemical
       recovery boiler system is that used in the
       pulp and paper manufacturing industry..... 22        15        

DEPRECIABLE ASSETS USED IN THE FOLLOWING ACTIVITIES:

01.1   Agriculture:
       Includes machinery and equipment, grain
       bins, and fences but no other land
       improvements, that are used in the
       production of crops or plants, vines, and
       trees; livestock; the operation of farm
       dairies, nurseries, greenhouses, sod farms,
       mushroom cellars, cranberry bogs, apiaries,
       and fur farms; the performance of
       agriculture, animal husbandry, and
       horticultural services.................... 10         7        

01.11  Cotton Ginning Assets..................... 12         7        
01.21  Cattle, Breeding or Dairy.................. 7         5         
01.221 Any breeding or work horse that is 12 years
       old or less at the time it is placed in
       service ** ............................... *         7        
01.222 Any breeding or work horse that is more
       than 12 years old at the time it is placed
       in service ** ............................ *         3        

01.223 Any race horse that is more than 2 years old
       at the time it is placed in service ** .... *         3        

01.224 Any horse that is more than 12 years old at
       the time it is placed in service and that
       is neither a race horse nor a horse
       described in class 01.222 ** .............. *         3        

01.225 Any horse not described in classes 01.221,
       01.222, 01.223, or 01.224.................. 12         7        

01.23  Hogs, Breeding............................. 3         3         

01.24  Sheep and Goats, Breeding.................. 5         5         

01.3   Farm buildings except structures included
       in Class 01.4............................. 25        20        
01.4   Single purpose agricultural or horticultural
       structures (within the meaning of section
       48(p) of the Code)........................ 15         7        
10.0   Mining:
       Includes assets used in the mining and
       quarrying of metallic and nonmetallic
       minerals (including sand, gravel, stone,
       and clay) and the milling, beneficiation
       and other primary preparation of such
       materials................................. 15         7        

* Property described in asset classes 01.223, 01.224, and 01.225 are
assigned recovery periods under either section 168(e)(3)(A) or section
168(g)(2)(C) but have no class lives.
** A horse is more than 2 (or 12) years old after the day that is 24
(or 144) months after its actual birth date.

13.0   Offshore Drilling:
       Includes assets used in offshore drilling
       for oil and gas such as floating, self-
       propelled and other drilling vessels,
       barges, platforms, and drilling equipment
       and support vessels such as tenders,
       barges, towboats and crewboats. Excludes
       oil and gas production assets.............. 7.5       5        

13.1   Drilling of Oil and Gas Wells:
       Includes assets used in the drilling of
       onshore oil and gas wells and the provision
       of geophysical and other exploration
       services; and the provision of such oil and
       gas field services as chemical treatment,
       plugging and abandoning of wells and
       cementing or perforating well casings. Does
       not include assets used in the performance
       of any of these activities and services by
       integrated petroleum and natural gas
       producers for their own account............ 6         5         

13.2   Exploration for and Production of Petroleum
       and Natural Gas Deposits:
       Includes assets used by petroleum and
       natural gas producers for drilling of wells
       and production of petroleum and natural gas,
       including gathering pipelines and related
       storage facilities. Also includes petroleum
       and natural gas offshore transportation
       facilities used by producers and others
       consisting of platforms (other than drilling
       platforms classified in Class 13.0),
       compression or pumping equipment, and
       gathering and transmission lines to the
       first onshore transshipment facility. The
       assets used in the first onshore
       transshipment facility are also included
       and consist of separation equipment (used
       for separation of natural gas, liquids, and
       solids), compression or pumping equipment
       (other than equipment classified in Class
       49.23), and liquid holding or storage
       facilities (other than those classified in
       Class 49.25). Does not include support
       vessels................................... 14         7        

13.3   Petroleum Refining:

       Includes assets used for the distillation,
       fractionation, and catalytic cracking of
       crude petroleum into gasoline and its
       other components.......................... 16        10        

15.0   Construction:

       Includes assets used in construction by
       general building, special trade, heavy and

       marine construction contractors, operative

       and investment builders, real estate

       subdividers and developers, and others

       except railroads........................... 6         5         6

                                                Recovery Periods

                                                      (in years)

                                                    Alter-

                                         General   native

                                                       Depre-

Asset                                        Class Life   ciation   ciation

class  Description of assets included        (in years)   System     System

20.1   Manufacture of Grain and Grain Mill Products:

       Includes assets used in the production of

       hours, cereals, livestock feeds, and other

       grain and grain mill products............. 17        10        17

20.2   Manufacture of Sugar and Sugar Products:

       Includes assets used in the production of

       raw sugar, syrup, or finished sugar from

       sugar cane or sugar beets................. 18        10        18

20.3   Manufacture of Vegetable Oils and Vegetable

       Oil Products:

       Includes assets used in the production of

       oil from vegetable materials and the

       manufacture of related vegetable oil

       products.................................. 18        10        18

20.4   Manufacture of Other Food and Kindred

       Products:

       Includes assets used in the production of

       foods and beverages not included in classes

       20.1, 20.2 and 20.3....................... 12         7        12

20.5.  Manufacture of Food and Beverages--Special

       Handling Devices:

       Includes assets defined as specialized

       materials handling devices such as

       returnable pallets, palletized containers,

       and fish processing equipment including

       boxes, baskets, carts, and flaking trays

       used in activities as defined in classes

       20.1, 20.2, 20.3 and 20.4. Does not include

       general purpose small tools such as wrenches

       and drills, both hand and power-driven, and

       other general purpose equipment such as

       conveyors, transfer equipment, and materials

       handling devices........................... 4         3         4

21.0   Manufacture of Tobacco and Tobacco Products:

       Includes assets used in the production of

       cigarettes, cigars, smoking and chewing

       tobacco, snuff, and other tobacco

       products.................................. 15         7        15

22.1   Manufacture of Knitted Goods:

       Includes assets used in the production of

       knitted and netted fabrics and lace. Assets

       used in yarn preparation, bleaching, dyeing,

       printing, and other similar finishing

       processes, texturing, and packaging, are

       elsewhere classified...................... 7.5        5        7.5

22.2   Manufacture of Yarn, Thread, and Woven

       Fabric:

       Includes assets used in the production of

       spun yarns including the preparing,

       blending, spinning, and twisting of fibers

       into yarns and threads, the preparation of

       yarns such as twisting, warping, and

       winding, the production of covered elastic

       yarn and thread, cordage, woven fabric,

       tire fabric, braided fabric, twisted jute

       for packaging, mattresses, pads, sheets,

       and industrial belts, and the processing of

       textile mill waste to recover fibers,

       flocks, and shoddies. Assets used to

       manufacture carpets, man-made fibers, and

       nonwovens, and assets used in texturing,

       bleaching, dyeing, printing, and other

       similar finishing processes, are elsewhere

       classified................................ 11         7        11

22.3   Manufacture of Carpets, and Dyeing,

       Finishing, and Packaging of Textile

       Products and Manufacture of Medical and

       Dental Supplies:

       Includes assets used in the production of

       carpets, rugs, mats, woven carpet backing,

       chenille, and other tufted products, and

       assets used in the joining together of

       backing with carpet yarn or fabric. Includes

       assets used in washing, scouring, bleaching,

       dyeing, printing, drying, and similar

       finishing processes applied to textile

       fabrics, yarns, threads, and other textile

       goods. Includes assets used in the

       production and packaging of textile

       products, other than apparel, by creasing,

       forming, trimming, cutting, and sewing, such

       as the preparation of carpet and fabric

       samples, or similar joining together

       processes (other than the production of

       scrim reinforced paper products and

       laminated paper products), such as the

       sewing and folding of hosiery and panty

       hose, and the creasing, folding, trimming,

       and cutting of fabrics to produce nonwoven

       products, such as disposable diapers and

       sanitary products. Also includes assets

       used in the production of medical and

       dental supplies other than drugs and

       medicines. Assets used in the manufacture

       of nonwoven carpet backing, and hard surface

       floor covering, such as tile, rubber, and

       cork, are elsewhere classified............. 9         5         9

22.4   Manufacture of Textured Yarns:

       Includes assets used in the processing of

       yarns to impart bulk and/or stretch

       properties to the yarn. The principal

       machines involved are falsetwist, draw,

       beam-to-beam, and stuffer box texturing

       equipment and related highspeed twisters

       and winders. Assets, as described above,

       which are used to further process man-made

       fibers are elsewhere classified when

       located in the same plant in an integrated

       operation with man-made fiber producing

       assets. Assets used to manufacture man-made

       fibers and assets used in bleaching, dyeing,

       printing, and other similar finishing

       processes, are elsewhere classified........ 8         5         8

22.5   Manufacture of Nonwoven Fabrics:

       Includes assets used in the production of

       nonwoven fabrics, felt goods including felt

       hats, padding, batting, wadding, oakum, and

       fillings, from new materials and from

       textile mill waste. Nonwoven fabrics are

       defined as fabrics (other than reinforced

       and laminated composites consisting of

       nonwovens and other products) manufactured

       by bonding natural and/or synthetic fibers

       and/or filaments by means of induced

       mechanical interlocking, fluid entanglement,

       chemical adhesion, thermal or solvent

       reaction, or by combination thereof other

       than natural hydration bonding as occurs

       with natural cellulose fibers. Such means

       include resin bonding, web bonding, and

       melt bonding. Specifically includes assets

       used to make flocked and needle punched

       products other than carpets and rugs.

       Assets, as described above, which are used

       to manufacture nonwovens are elsewhere

       classified when located in the same plant

       in an integrated operation with man-made

       fiber producing assets. Assets used to

       manufacture man-made fibers and assets used

       in bleaching, dyeing, printing, and other

       similar finishing processes, are elsewhere

       classified................................ 10         7        10

23.0   Manufacture of Apparel and Other Finished

       Products:

       Includes assets used in the production of

       clothing and fabricated textile products by

       the cutting and sewing of woven fabrics,

       other textile products. and furs; but does

       not include assets used in the manufacture

       of apparel from rubber and leather......... 9         5         9

24.1   Cutting of Timber:

       Includes logging machinery and equipment and

       roadbuilding equipment used by logging and

       sawmill operators and pulp manufacturers

       for their own account...................... 6         5         6

24.2   Sawing of Dimensional Stock from Logs:

       Includes machinery and equipment installed

       in permanent or well established sawmills  10         7        10

24.3   Sawing of Dimensional Stock from Logs:

       Includes machinery and equipment installed

       in sawmills characterized by temporary

       foundations and a lack, or minimum amount,

       of lumberhandling, drying, and residue

       disposal equipment and facilities.......... 6         5         6

24.4   Manufacture of Wood Products, and Furniture:

       Includes assets used in the production of

       plywood, hardboard, flooring, veneers,

       furniture, and other wood products,

       including the treatment of poles and

       timber.................................... 10         7        10

26.1   Manufacture of Pulp and Paper:

       Includes assets for pulp materials handling

       and storage, pulp mill processing, bleach

       processing, paper and paperboard

       manufacturing, and on-line finishing.

       Includes pollution control assets and all

       land improvements associated with the

       factory site or production process such as

       effluent ponds and canals, provided such

       improvements are depreciable but does not

       include buildings and structural components

       as defined in section 1.48-1(e)(1) of the

       regulations. Includes steam and chemical

       recovery boiler systems, with any rated

       capacity, used for the recovery and

       regeneration of chemicals used in

       manufacturing. Does not include assets

       used either in pulpwood logging, or in the

       manufacture of hardboard.................. 13         7        13

26.2   Manufacture of Converted Paper, Paperboard,

       and Pulp Products:

       Includes assets used for modification, or

       remanufacture of paper and pulp into

       converted products, such as paper coated

       off the paper machine, paper bags, paper

       boxes, cartons and envelopes. Does not

       include assets used for manufacture of

       nonwovens that are elsewhere classified... 10         7        10

27.0   Printing, Publishing, and Allied Industries:

       Includes assets used in printing by one or

       more processes, such as letter-press,

       lithography, gravure, or screen; the

       performance of services for the printing

       trade, such as bookbinding, typesetting,

       engraving, photo-engraving, and

       electrotyping; and the publication of

       newspapers, books, and periodicals........ 11         7        11

28.0   Manufacture of Chemicals and Allied Products:

       Includes assets used to manufacture basic

       organic and inorganic chemicals; chemical

       products to be used in further manufacture,

       such as synthetic fibers and plastics

       materials; and finished chemical products.

       Includes assets used to further process

       man-made fibers, to manufacture plastic

       film, and to manufacture nonwoven fabrics,

       when such assets are located in the same

       plant in an integrated operation with

       chemical products producing assets. Also

       includes assets used to manufacture

       photographic supplies, such as film,

       photographic paper, sensitized photographic

       paper, and developing chemicals. Includes

       all land improvements associated with plant

       site or production processes, such as

       effluent ponds and canals, provided such

       land improvements are depreciable but does

       not include buildings and structural

       components as defined in section 1.48-1(e)

       of the regulations. Does not include assets

       used in the manufacture of finished rubber

       and plastic products or in the production

       of natural gas products, butane, propane,

       and byproducts of natural gas production

       plants.................................... 9.5        5        9.5

30.1   Manufacture of Rubber Products:

       Includes assets used for the production of

       products from natural, synthetic, or

       reclaimed rubber, gutta percha, balata, or

       gutta siak, such as tires, tubes, rubber

       footwear, mechanical rubber goods, heels and

       soles, flooring, and rubber sundries; and in

       the recapping, retreading, and rebuilding

       of tires.................................. 14         7         14

30.11  Manufacture of Rubber Products--Special

       Tools and Devices:

       Includes assets defined as special tools,

       such as jigs, dies, mandrels, molds, lasts,

       patterns, specialty containers, pallets,

       shells; and tire molds, and accessory parts

       such as rings and insert plates used in

       activities as defined in class 30.1. Does

       not include tire building drums and

       accessory parts and general purpose small

       tools such as wrenches and drills, both

       power and hand-driven, and other general

       purpose equipment such as conveyors and

       transfer equipment......................... 4         3         4

30.2   Manufacture of Finished Plastic Products:

       Includes assets used in the manufacture of

       plastics products and the molding of

       primary plastics for the trade. Does not

       include assets used in the manufacture of

       basic plastics materials nor the

       manufacture of phonograph records......... 11         7        11

30.21  Manufacture of Finished Plastic Products--

       Special Tools:

       Includes assets defined as special tools,

       such as jigs, dies, fixtures, molds,

       patterns, gauges, and specialty transfer

       and shipping devices, used in activities as

       defined in class 30.2. Special tools are

       specifically designed for the production or

       processing of particular parts and have no

       significant utilitarian value and cannot be

       adapted to further or different use after

       changes or improvements are made in the

       model design of the particular part

       produced by the special tools. Does not

       include general purpose small tools such as

       wrenches and drills, both hand and power-

       driven, and other general purpose equipment

       such as conveyors, transfer equipment, and

       materials handling devices................ 3.5        3         3.5

31.0   Manufacture of Leather and Leather Products:

       Includes assets used in the tanning,

       currying, and finishing of hides and skins;

       the processing of fur pelts; and the

       manufacture of finished leather products,

       such as footwear, belting, apparel, and

       luggage................................... 11         7        11

                                                Recovery Periods

                                                      (in years)

                                                      Alter-

                                              General  native

                                                        Depre-

Asset                                        Class Life   ciation   ciation

class  Description of assets included        (in years)   System     System

32.1   Manufacture of Glass Products:

       Includes assets used in the production of

       flat, blown, or pressed products of glass,

       such as float and window glass, glass

       containers, glassware and fiberglass. Does

       not include assets used in the manufacture

       of lenses................................. 14         7        14

32.11  Manufacture of Glass Products--Special

       Tools:

       Includes assets defined as special tools

       such as molds, patterns, pallets, and

       specialty transfer and shipping devices

       such as steel racks to transport automotive

       glass, used in activities as defined in

       class 32.1. Special tools are specifically

       designed for the production or processing

       of particular parts and have no significant

       utilitarian value and cannot be adapted to

       further or different use after changes or

       improvements are made in the model design

       of the particular part produced by the

       special tools. Does not include general

       purpose small tools such as wrenches and

       drills, both hand and power driven, and

       other general purpose equipment such as

       conveyors, transfer equipment, and

       materials handling devices................ 2.5        3         2.5

32.2   Manufacture of Cement:

       Includes assets used in the production of

       cement, but does not include any assets

       used in the manufacture of concrete and

       concrete products nor in any mining or

       extraction process........................ 20        15        20

32.3   Manufacture of Other Stone and Clay Products:

       Includes assets used in the manufacture of

       products from materials in the form of clay

       and stone, such as brick, tile, and pipe;

       pottery and related products, such as

       vitreous-china, plumbing fixtures,

       earthenware and ceramic insulating

       materials; and also includes assets used

       in manufacture of concrete and concrete

       products. Does not include assets used in

       any mining or extraction processes........ 15         7        15

33.2   Manufacture of Primary Nonferrous Metals:

       Includes assets used in the smelting,

       refining, and electrolysis of nonferrous

       metals from ore, pig, or scrap, the rolling,

       drawing, and alloying of nonferrous metals;

       the manufacture of castings, forgings, and

       other basic products of nonferrous metals;

       and the manufacture of nails, spikes,

       structural shapes, tubing, wire, and

       cable..................................... 14         7         14

33.21  Manufacture of Primary Nonferrous Metals--

       Special Tools:

       Includes assets defined as special tools

       such as dies, jigs, molds, patterns,

       fixtures, gauges, and drawings concerning

       such special tools used in the activities

       as defined in class 33.2, Manufacture of

       Primary Nonferrous Metals. Special tools

       are specifically designed for the production

       or processing of particular products or

       parts and have no significant utilitarian

       value and cannot be adapted to further or

       different use after changes or improvements

       are made in the model design of the

       particular part produced by the special

       tools. Does not include general purpose

       small tools such as wrenches and drills,

       both hand and power-driven, and other

       general purpose equipment such as conveyors,

       transfer equipment, and materials handling

       devices. Rolls, mandrels and refractories

       are not included in class 33.21 but are

       included in class 33.2.................... 6.5       5        6.5

33.3   Manufacture of Foundry Products:

       Includes assets used in the casting of iron

       and steel, including related operations such

       as molding and coremaking. Also includes

       assets used in the finishing of castings and

       patternmaking when performed at the foundry,

       all special tools and related land

       improvements.............................. 14         7        14

33.4   Manufacture of Primary Steel Mill Products:

       Includes assets used in the smelting,

       reduction, and refining of iron and steel

       from ore, pig, or scrap; the rolling,

       drawing and alloying of steel; the

       manufacture of nails, spikes, structural

       shapes, tubing, wire, and cable. Includes

       assets used by steel service centers,

       ferrous metal forges, and assets used in

       coke production, regardless of ownership.

       Also includes related land improvements and

       all special tools used in the above

       activities................................ 15         7        15

34.0   Manufacture of Fabricated Metal Products

       Special Tools:

       Includes assets used in the production of

       metal cans, tinware, fabricated structural

       metal products, metal stampings, and other

       ferrous and nonferrous metal and wire

       products not elsewhere classified. Does

       not include assets used to manufacture

       non-electric heating apparatus............ 12         7        12

34.01  Manufacturer of Fabricated Metal Products

       Special Tools:

       Includes assets defined as special tools

       such as dies, jigs, molds, patterns,

       fixtures, gauges, and returnable containers

       and drawings concerning such special tools

       used in the activities as defined in class

       34.0. Special tools are specifically

       designed for the production or processing

       of particular machine components, products,

       or parts, and have no significant

       utilitarian value and cannot be adapted to

       further or different use after changes or

       improvements are made in the model design

       of the particular part produced by the

       special tools. Does not include general

       purpose small tools such as wrenches and

       drills, both hand and power-driven, and

       other general purpose equipment such as

       conveyors, transfer equipment, and

       materials handling devices................. 3         3         3

35.0   Manufacture of Electrical and Non-Electrical

       Machinery and Other Mechanical Products:

       Includes assets used to manufacture or

       rebuild finished machinery and equipment and

       replacement parts thereof such as machine

       tools, general industrial and special

       industry machinery, electrical power

       generation, transmission, and distribution

       systems, space heating, cooling, and

       refrigeration systems, commercial and home

       appliances, farm and garden machinery,

       construction machinery, mining and oil

       field machinery, internal combustion engines

       (except those elsewhere classified),

       turbines (except those that power airborne

       vehicles), batteries, lamps and lighting

       fixtures, carbon and graphite products, and

       electromechanical and mechanical products

       including business machines, instruments,

       watches and clocks, vending and amusement

       machines, photographic equipment, medical

       and dental equipment and appliances, and

       ophthalmic goods. Includes assets used by

       manufacturers or rebuilders of such

       finished machinery and equipment in

       activities elsewhere classified such as the

       manufacture of castings, forgings, rubber

       and plastic products, electronic

       subassemblies or other manufacturing

       activities if the interim products are used

       by the same manufacturer primarily in the

       manufacture, assembly, or rebuilding of such

       finished machinery and equipment. Does not

       include assets used in mining, assets used

       in the manufacture of primary ferrous and

       nonferrous metals, assets included in class

       00. 11 through 00.4 and assets elsewhere

       classified................................ 10         7        10

36.0   Manufacture of Electronic Components,

       Products, and Systems:

       Includes assets used in the manufacture of

       electronic communication, computation,

       instrumentation and control systems,

       including airborne applications; also

       includes assets used in the manufacture of

       electronic products such as frequency and

       amplitude modulated transmitters and

       receivers, electronic switching stations,

       television cameras, video recorders, record

       players and tape recorders, computers and

       computer peripheral machines, and electronic

       instruments, watches, and clocks; also

       includes assets used in the manufacture of

       components, provided their primary use is

       in products and systems defined above such

       as electron tubes, capacitors, coils,

       resistors, printed circuit substrates,

       switches, harness cables, lasers, fiber

       optic devices, and magnetic media devices.

       Specifically excludes assets used to

       manufacture electronic products and

       components, photocopiers, typewriters,

       postage meters and other electromechanical

       and mechanical business machines and

       instruments that are elsewhere classified.

       Does not include semiconductor manufacturing

       equipment included in class 36.1........... 6         5         6

36.1   Any Semi-conductor Manufacturing Equipment  5         5         5

37.11  Manufacture of Motor Vehicles:

       Includes assets used in the manufacture and

       assembly of finished automobiles, trucks,

       trailers, motor homes, and buses. Does not

       include assets used in mining, printing and

       publishing, production of primary metals,

       electricity, or steam, or the manufacture

       of glass, industrial chemicals, batteries,

       or rubber products, which are classified

       elsewhere. Includes assets used in

       manufacturing activities elsewhere

       classified other than those excluded above,

       where such activities are incidental to and

       an integral part of the manufacture and

       assembly of finished motor vehicles such as

       the manufacture of parts and subassemblies

       of fabricated metal products, electrical

       equipment, textiles, plastics, leather, and

       foundry and forging operations. Does not

       include any assets not classified in

       manufacturing activity classes, e.g., does

       not include assets classified in asset

       classes 00.11 through 00.4. Activities will

       be considered incidental to the manufacture

       and assembly of finished motor vehicles only

       if 75 percent or more of the value of the

       profits produced under one roof are used for

       the manufacture and assembly of finished

       motor vehicles. Parts that are produced as

       a normal replacement stock complement in

       connection with the manufacture and assembly

       of finished motor vehicles are considered

       used for the manufacture and assembly of

       finished motor vehicles. Do not include

       assets used in the manufacture of component

       parts if these assets are used by taxpayers

       not engaged in the assembly of finished

       motor vehicles............................ 12         7         12

37.12  Manufacture of Motor Vehicles-Special Tools:

       Includes assets defined as special tools,

       such as jigs, dies, fixtures, molds,

       patterns, gauges, and specialty transfer and

       shipping devices, owned by manufacturers of

       finished motor vehicles and used in

       qualified activities as defined in class

       37.11. Special tools are specifically

       designed for the production or processing

       of particular motor vehicle components and

       have no significant utilitarian value, and

       cannot be adapted to further or different

       use, after changes or improvements are made

       in the model design of the particular part

       produced by the special tools. Does not

       include general purpose small tools such as

       wrenches and drills, both hand and

       powerdriven, and other general purpose

       equipment such as conveyors, transfer

       equipment, and materials handling devices... 3         7        12

37.2   Manufacture of Aerospace Products:

       Includes assets used in the manufacture and

       assembly of airborne vehicles and their

       component parts including hydraulic,

       pneumatic, electrical, and mechanical

       systems. Does not include assets used in the

       production of electronic airborne detection,

       guidance, control, radiation, computation,

       test, navigation, and communication

       equipment or the components thereof....... 10         7        10

37.31  Ship and Boat Building Machinery and

       Equipment:

       Includes assets used in the manufacture and

       repair of ships, boats, caissons, marine

       drilling rigs, and special fabrications not

       included in asset classes 37.32 and 37.33.

       Specifically includes all manufacturing and

       repairing machinery and equipment, including

       machinery and equipment used in the

       operation of assets included in asset class

       37.32. Excludes buildings and their

       structural components..................... 12         7        12

37.32  Ship and Boat Building Dry Docks and Land

       Improvements:

       Includes assets used in the manufacture and

       repair of ships, boats, caissons, marine

       drilling rigs, and special fabrications not

       included in asset classes 37.31 and 37.33.

       Specifically includes floating and fixed

       dry docks, ship basins, graving docks,

       shipways, piers, and all other land

       improvements such as water, sewer, and

       electric systems. Excludes buildings and

       their structural components............... 16         10       16

37.33  Ship and Boat Building-Special Tools:

       Includes assets defined as special tools

       such as dies, jigs, molds, patterns,

       fixtures, gauges, and drawings concerning

       such special tools used in the activities

       defined in classes 37.31 and 37.32. Special

       tools are specifically designed for the

       production or processing of particular

       machine components, products, or parts, and

       have no significant utilitarian value and

       cannot be adapted to further or different

       use after changes or improvements are made

       in the model design of the particular part

       produced by the special tools. Does not

       include general purpose small tools such as

       wrenches and drills, both hand and power-

       driven, and other general purpose equipment

       such as conveyors, transfer equipment, and

       materials handling devices................ 6.5        5       6.5

                                                Recovery Periods

                                                      (in years)

                                                       Alter-

                                                General native

                                                          Depre-

Asset                                        Class Life   ciation   ciation

class  Description of assets included        (in years)   System     System

37.41  Manufacture of Locomotives:

       Includes assets used in building or

       rebuilding railroad locomotives (including

       mining and industrial locomotives). Does not

       include assets of railroad transportation

       companies or assets of companies which

       manufacture components of locomotives but

       do not manufacture finished locomotives... 11.5       7      11.5

37.42  Manufacture of Railroad Cars:

       Includes assets used in building or

       rebuilding railroad freight or passenger

       cars (including rail transit cars). Does

       not include assets of railroad

       transportation companies or assets of

       companies which manufacture components of

       railroad cars but do not manufacture

       finished railroad cars.................... 12         7        12

39.0   Manufacture of Athletic, Jewelry and Other

       Goods:

       Includes assets used in the production of

       jewelry; musical instruments; toys and

       sporting goods; motion picture and

       television films and tapes; and pens,

       pencils, office and art supplies, brooms,

       brushes, caskets, etc..................... 12         7        12

       Railroad Transportation:

       Classes with the prefix 40 include the

       assets identified below that are used in

       the commercial and contract carrying of

       passengers and freight by rail. Assets

       of electrified railroads will be classified

       in a manner corresponding to that set forth

       below for railroads not independently

       operated as electric lines. Excludes the

       assets included in classes with the prefix

       beginning 00.1 and 00.2 above, and also

       excludes any non-depreciable assets included

       in Interstate Commerce Commission accounts

       enumerated for this class.

40.1   Railroad Machinery and Equipment:

       Includes assets classified in the following

       Interstate Commerce Commission accounts:

       Roadway accounts:

         (16) Station and office buildings (freight

              handling machinery and equipment only)

         (25) TOFC/COFC terminals (freight handling

              machinery and equipment only)

         (26) Communication systems

         (27) Signals and interlockers

         (37) Roadway machines

         (44) Shop machinery

       Equipment Accounts:

         (52) Locomotives

         (53) Freight train cars

         (54) Passenger train cars

         (57) Work equipment..................... 14         7        14

40.2   Railroad Structures and Similar Improvements:

       Includes assets classified in the following

       Interstate Commerce Commission road accounts:

          (6) Bridges, trestles, and culverts

          (7) Elevated structures

         (13) Fences, snowsheds, and signs

         (16) Station and office buildings (stations

              and other operating structures only)

         (17) Roadway buildings

         (18) Water stations

         (19) Fuel stations

         (20) Shops and enginehouses

         (25) TOFC/COFC terminals (operating

              structures only)

         (31) Power transmission systems

         (35) Miscellaneous structures

         (39) Public improvements construction... 30        20        30

40.3   Railroad Wharves and Docks:

       Includes assets classified in the following

       Interstate Commerce accounts:

         (23) Wharves and docks

         (24) Coal and ore wharves............... 20        15        20

40.4   Railroad Track............................ 10         7        10

40.51  Railroad Hydraulic Electric Generating

       Equipment................................. 50        20        50

40.52  Railroad Nuclear Electric Generating

       Equipment................................. 20        15        20

40.53  Railroad Steam Electric Generating

       Equipment................................. 28        20        28

40.54  Railroad Steam, Compressed Air, and Other

       Power Plant Equipment..................... 28        20        28

41.0   Motor Transport-Passengers:

       Includes assets used in the urban and

       interurban commercial and contract carrying

       of passengers by road, except the

       transportation assets included in classes

       with the prefix 00.2....................... 8         5         8

42.0   Motor Transport-Freight:

       Includes assets used in the commercial and

       contract carrying of freight by road, except

       the transportation assets included in

       classes with the prefix 00.2............... 8         5         8

44.0   Water Transportation:

       Includes assets used in the commercial and

       contract carrying of freight and passengers

       by water except the transportation assets

       included in classes with the prefix 00.2.

       Includes all related land improvements.... 20        15        20

45.0   Air Transport:

       Includes assets (except helicopters) used

       in commercial and contract carrying of

       passengers and freight by air. For purposes

       of section 1.167(a)-11(d)(2)(iv)(a) of the

       regulations, expenditures for “repair,

       maintenance, rehabilitation, or

       improvement” shall consist of direct

       maintenance expenses (irrespective of

       airworthiness provisions or charges) as

       defined by Civil Aeronautics Board uniform

       accounts 5200, maintenance burden (exclusive

       of expenses pertaining to maintenance

       buildings and improvements) as defined by

       Civil Aeronautics Board uniform accounts

       5300, and expenditures which are not

       “excluded additions” as defined in

       section 1.167(a)-11(d)(2)(vi) of the

       regulations and which would be charged to

       property and equipment accounts in the

       Civil Aeronautics Board uniform system

       of accounts............................... 12         7        12

45.1   Air Transport (restricted):

       Includes each asset described in the

       description of class 45.0 which was held

       by the taxpayer on April 15, 1976, or is

       acquired by the taxpayer pursuant to a

       contract which was, on April 15, 1976, and

       at all times thereafter, binding on the

       taxpayer. This criterion of classification

       based on binding contract concept is to be

       applied in the same manner as under the

       general rules expressed in section 49(b)(1),

       (4), (5) and (8) of the Code (as in effect

       prior to its repeal by the Revenue Act of

       1978, section 312(c)(1), (d), 1978-3

       C.B. 1, 60)................................ 6         5         6

46.0   Pipeline Transportation:

       Includes assets used in the private,

       commercial, and contract carrying of

       petroleum, gas and other products by means

       of pipes and conveyors. The trunk lines and

       related storage facilities of integrated

       petroleum and natural gas producers are

       included in this class. Excludes initial

       clearing and grading land improvements as

       specified in Rev. Rul. 72-403, 1972-2 C.B.

       102, but includes all other related land

       improvements.............................. 22        15        22

       Telephone Communications:

       Includes the assets identified below and

       that are used in the provision of commercial

       and contract telephonic services such as:

48.11  Telephone Central Office Buildings:

       Includes assets intended to house central

       office equipment, as defined in Federal

       Communications Commission Part 31 Account

       No. 212 whether section 1245 or section

       1250 property............................. 45        20        45

48.12  Telephone Central Office Equipment:

       Includes central office switching and

       related equipment as defined in Federal

       Communications Commission Part 31 Account

       No. 221.

       Does not include computer-based telephone

       central office switching equipment included

       in class 48.121. Does not include private

       branch exchange (PBX) equipment........... 18        10        18

48.121 Computer-based Telephone Central Office

       Switching Equipment:

       Includes equipment whose functions are those

       of a computer or peripheral equipment (as

       defined in section 168(i)(2)(B) of the Code)

       used in its capacity as telephone central

       office equipment. Does not include private

       branch exchange (PBX) equipment........... 9.5        5        9.5

48.13  Telephone Station Equipment:

       Includes such station apparatus and

       connections as teletypewriters, telephones,

       booths, private exchanges, and comparable

       equipment as defined in Federal

       Communications Commission Part 31 Account

       Nos. 231, 232, and 234.................... 10         7 *       10 *

* Property described in asset guideline class 48.13 which is qualified

technological equipment as defined in section 168(i)(2) is assigned a

5-year recovery period for both the general and alternative depreciation

systems.

48.14  Telephone Distribution Plant:

       Includes such assets as pole lines, cable,

       aerial wire, underground conduits, and

       comparable equipment, and related land

       improvements as defined in Federal

       Communications Commission Part 31 Account

       Nos. 241, 242.1, 242.2, 242.3, 242.4,

       243, and 244.............................. 24        15        24

48.2   Radio and Television Broadcastings:

       Includes assets used in radio and television

       broadcasting, except transmitting towers... 6         5         6

       Telegraph, Ocean Cable, and Satellite

       Communications (TOCSC) includes

       communications-related assets used to

       provide domestic and international radio-

       telegraph, wire-telegraph, ocean-cable, and

       satellite communications services; also

       includes related land improvements. If

       property described in Classes 48.31 is 48.45

       comparable to telephone distribution plant

       described in Class 48.14 and used for 2-way

       exchange of voice and data communication

       which is the equivalent of telephone

       communication, such property is assigned a

       class life of 24 years under this revenue

       procedure. Comparable equipment does not

       include cable television equipment used

       primarily for 1-way communication.

48.31  TOCSC-Electric Power Generating and

       Distribution Systems:

       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........................ 19        10        19

48.32  TOCSC-High Frequency Radio and Microwave

       Systems:

       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................................... 13         7        13

48.33  TOCSC-Cable and Long-line Systems:

       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...... 26.5      20       26.5

48.34  TOCSC-Central Office Control Equipment:

       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.............................. 16.5      10       16.5

48.35  TOCSC-Computerized Switching, Channeling,

       and Associated Control Equipment:

       Includes central office switching computers,

       interfacing computers, other associated

       specialized control equipment, and site

       improvements.............................. 10.5       7       10.5

48.36  TOCSC-Satellite Ground Segment Property:

       Includes assets such as fixed earth

       station equipment, antennas, satellite

       communications equipment, and interface

       equipment used in satellite communications.

       Does not include general purpose equipment

       or equipment used in satellite space

       segment property......................... 10         7        10

48.37  TOCSC-Satellite Space Segment Property:

       Includes satellites and equipment used for

       telemetry, tracking, control, and monitoring

       when used in satellite communications...... 8         5         8

48.38  TOCSC-Equipment Installed on Customer’s

       Premises:

       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.... 10         7        10

                                                Recovery Periods

                                                      (in years)

                                                      Alter-

                                              General native

                                                          Depre-

Asset                                        Class Life   ciation   ciation

class  Description of assets included        (in years)   System     System

48.39  TOCSC-Support and Service Equipment:

       Includes assets used to support but not

       engage in communications. Includes store,

       warehouse and shop tools, and test and

       laboratory assets......................... 13.5        7      13.5

       Cable Television (CATV):

       Includes communications-related assets used

       to provide cable television community

       antenna television services). Does not

       include assets used to provide subscribers

       with two-way communications services.

48.41  CATV-Headend:

       Includes assets such as towers, antennas,

       preamplifiers, converters, modulation

       equipment, and program non-duplication

       systems. Does not include headend buildings

       and program origination assets............ 11         7        11

48.42  CATV-Subscriber Connection and Distribution

       Systems:

       Includes assets such as trunk and feeder

       cable, connecting hardware, amplifiers,

       power equipment, passive devices,

       directional taps, pedestals, pressure taps,

       drop cables, matching transformers, multiple

       set connector equipment, and converters... 10         7        10

48.43  CATV-Program Origination:

       Includes assets such as cameras, film

       chains, video tape recorders, lighting,

       and remote location equipment excluding

       vehicles. Does not include buildings and

       their structural components................ 9         5         9

48.44  CATV-Service and Test:

       Includes assets such as oscilloscopes,

       field strength meters, spectrum analyzers,

       and cable testing equipment, but does not

       include vehicles.......................... 8.5        5       8.5

48.45  CATV-Microwave Systems:

       Includes assets such as towers, antennas,

       transmitting and receiving equipment, and

       broad band microwave assets if used in the

       provision of cable television services.

       Does not include assets used in the

       provision of common carrier services...... 9.5        5       9.5

       Electric, Gas, Water and Steam, Utility

       Services:

       Includes assets used in the production,

       transmission and distribution of

       electricity, gas, steam, or water for sale

       including related land improvements.

49.11  Electric Utility Hydraulic Production Plant:

       Includes assets used in the hydraulic power

       production of electricity for sale, including

       related land improvements, such as dams,

       flumes, canals, and waterways............. 50        20        50

49.12  Electric Utility Nuclear Production Plant:

       Includes assets used in the nuclear power

       production and electricity for sale and

       related land improvements. Does not

       include nuclear fuel assemblies........... 20        15        20

49.121 Electric Utility Nuclear Fuel Assemblies:

       Includes initial core and replacement core

       nuclear fuel assemblies (i.e., the composite

       of fabricated nuclear fuel and container)

       when used in a boiling water, pressurized

       water, or high temperature gas reactor used

       in the production of electricity. Does not

       include nuclear fuel assemblies used in

       breeder reactors........................... 5         5         5

49.13  Electric Utility Steam Production Plant:

       Includes assets used in the steam power

       production of electricity for sale,

       combustion turbines operated in a combined

       cycle with a conventional steam unit and

       related land improvements. Also includes

       package boilers, electric generators and

       related assets such as electricity and

       steam distribution systems as used by a

       waste reduction and resource recovery plant

       if the steam or electricity is normally

       for sale to others........................ 28        20        28

49.14  Electric Utility Transmission and

       Distribution Plant:

       Includes assets used in the transmission

       and distribution of electricity for sale and

       related land improvements. Excludes initial

       clearing and grading land improvements as

       specified in Rev. Rul. 72-403, 1972-2

       C.B. 102.................................. 30        20        30

49.15  Electric Utility Combustion Turbine

       Production Plant:

       Includes assets used in the production of

       electricity for sale by the use of such

       prime movers as jet engines, combustion

       turbines, diesel engines, gasoline engines,

       and other internal combustion engines, their

       associated power turbines and/or generators,

       and related land improvements. Does not

       include combustion turbines operated in

       a combined cycle with a conventional

       steam unit................................ 20        15        20

49.21  Gas Utility Distribution Facilities:

       Includes gas water heaters and gas

       conversion equipment installed by utility

       on customers premises on a rental basis... 35        20        35

49.221 Gas Utility Manufactured Gas Production

       Plants:

       Includes assets used in the manufacture

       of gas having chemical and/or physical

       properties which do not permit complete

       interchangeability with domestic natural

       gas. Does not include gas producing

       systems and related systems used in waste

       reduction and resource recovery plants

       which are elsewhere classified............ 30        20        30

49.222 Gas Utility Substitute Natural Gas (SNG)

       Production Plant (naphtha or lighter

       hydrocarbon feedstocks):

       Includes assets used in the catalytic

       conversion of feedstocks or naphtha or

       lighter hydrocarbons to a gaseous fuel

       which is completely interchangeable with

       domestic natural gas...................... 14         7        14

49.223 Substitute Natural Gas-Coal Gasification:

       Includes assets used in the manufacture and

       production of pipeline quality gas from coal

       using the basic Lurgi process with advanced

       methanation. Includes all process plant

       equipment and structures used in this coal

       gasification process and all utility assets

       such as cooling systems, water supply and

       treatment facilities, and assets used in the

       production and distribution of electricity

       and steam for use by the taxpayer in a

       gasification plant and attendant coal mining

       site processes but not for assets used in the

       production and distribution of electricity

       and steam for sale to others. Also includes

       all other related land improvements. Does not

       include assets used in the direct mining and

       treatment of coal prior to the gasification

       process itself............................ 18        10        18

49.23  Natural Gas Production Plant.............. 14         7        14

49.24  Gas Utility Trunk Pipelines and Related

       Storage Facilities:

       Excluding initial clearing and grading

       land improvements as specified in

       Rev. Rul. 72-403.......................... 22        15        22

49.25  Liquefied Natural Gas Plant:

       Includes assets used in the liquefaction,

       storage, and regasification of natural gas

       including loading and unloading connections,

       instrumentation equipment and controls,

       pumps, vaporizers and odorizers, tanks, and

       related land improvements. Also includes

       pipeline interconnections with gas

       transmission lines and distribution systems

       and marine terminal facilities............ 22        15        22

49.3   Water Utilities:

       Includes assets used in the gathering,

       treatment, and commercial distribution

       of water.................................. 50        20        50

49.4   Central Steam Utility Production and

       Distribution:

       Includes assets used in the production and

       distribution of steam for sale. Does not

       include assets used in waste reduction and

       resource recovery plants which are

       elsewhere classified...................... 28        20        28

49.5   Waste Reduction and Resource Recovery Plants:

       Includes assets used in the conversion of

       refuse or other solid waste or biomass to

       heat or to a solid, liquid, or gaseous fuel.

       Also includes all process plant equipment

       and structures at the site used to receive,

       handle, collect, and process refuse or other

       solid waste or biomass to a solid, liquid,

       or gaseous fuel or to handle and burn refuse

       or other solid waste or biomass in a

       waterwall combustion system, oil or gas

       pyrolysis system, or refuse derived fuel

       system to create hot water, gas, steam and

       electricity. Includes material recovery and

       support assets used in refuse or solid

       refuse or solid waste receiving, collecting,

       handling, sorting, shredding, classifying,

       and separation systems. Does not include any

       package boilers, or electric generators and

       related assets such as electricity, hot

       water, steam and manufactured gas production

       plants classified in classes 00.4, 49.13,

       49.221, and 49.4. Does include, however, all

       other utilities such as water supply and

       treatment facilities, ash handling and other

       related land improvements of a waste

       reduction and resource recovery plant..... 10         7        10

50.    Municipal Wastewater Treatment Plant...... 24        15        24

51.    Municipal Sewer........................... 50        20        50

57.0   Distributive Trades and Services:

       Includes assets used in wholesale and

       retail trade, and personal and professional

       services. Includes section 1245 assets used

       in marketing petroleum and petroleum

       products................................... 9         5         9 *

* Any high technology medical equipment as defined in section 168(i)(2)(C)

which is described in asset guideline class 57.0 is assigned a 5-year

recovery period for the alternative depreciation system.

57.1   Distributive Trades and Services-Billboard,

       Service Station Buildings and Petroleum

       Marketing Land Improvements:

       Includes section 1250 assets, including

       service station buildings and depreciable

       land improvements, whether section 1245

       property or section 1250 property, used in

       the marketing of petroleum and petroleum

       products, but not including any of these

       facilities related to petroleum and natural

       gas trunk pipelines. Includes car wash

       buildings and related land improvements.

       Includes billboards, whether such assets are

       section 1245 property or section 1250

       property. Excludes all other land

       improvements, buildings and structural

       components as defined in section 1.48-1(e)

       of the regulations........................ 20        15        20

79.0   Recreation:

       Includes assets used in the provision of

       entertainment services on payment of a fee

       or admission charge, as in the operation of

       bowling alleys, billiard and pool

       establishments, theaters, concert halls,

       and miniature golf courses. Does not include

       amusement and theme parks and assets which

       consist primarily of specialized land

       improvements or structures, such as golf

       courses, sports stadia, race tracks, ski

       slopes, and buildings which house the

       assets used in entertainment services..... 10         7        10

80.0   Theme and Amusement Parks:

       Includes assets used in the provision of

       rides, attractions, and amusements in

       activities defined as theme and amusement

       parks, and includes appurtenances associated

       with a ride, attraction, amusement or theme

       setting within the park such as ticket

       booths, facades, shop interiors, and props,

       special purpose structures, and buildings

       other than warehouses, administration

       buildings, hotels, and motels. Includes all

       land improvements for or in support of park

       activities, (e.g., parking lots, sidewalks,

       waterways, bridges, fences, landscaping,

       etc.) and support functions (e.g., food and

       beverage retailing, souvenir vending and

       other nonlodging accommodations) if owned

       by the park and provided exclusively for the

       benefit of park patrons. Theme and amusement

       parks are defined as combinations of

       amusements, rides, and attractions which are

       Permanently situated on park land and open

       to the public for the price of admission.

       This guideline class is a composite of all

       assets used in this industry except

       transportation equipment (general purpose

       trucks, cars, airplanes, etc., which are

       included in asset guideline classes with the

       prefix 00.2), assets used in the provision

       of administrative services (asset classes

       with the prefix 00.1), and warehouses,

       administration buildings, hotels and

       motels.................................... 12.5       7       12.5

       Certain Property for Which Recovery

       Periods Assigned

       A. Personal Property With No Class Life               7        12

       Section 1245 Real Property With No Class Life         7        40

       B. Qualified Technological Equipment, as

          defined in section 168(i)(2)............ *         5         5

       C. Property Used in Connection with Research

          and Experimentation referred to in

          section 168(e)(3)(B).................... *         5   class life

                                                           if no

                                                        life-12

       D. Alternative Energy Property described in

          sections 48(1)(3)(viii) or (iv), or

          section 48(1)(4) of the Code............ *         5   class life

                                                           if no

                                                         life-12

      E. Biomass property described in section

         48(1)(15) and is a qualifying small

         production facility within the meaning of

         section 3(17)(c) of the Federal Power Act,

         (16 U.S.C. 796(17)(C)), as in effect on

         September 1, 1986........................ *         5   class life

                                                           if no

                                                         life-12

* The class life (if any) of property described in classes B, C, D, or E is

determined by reference to the asset guideline classes in this revenue

procedure. If an item of property described in Paragraphs B, C, D, or E is

not described in any asset guideline class, such item of property has no

class life.