26 U.S.C. § 177 — Untitled legal text

Page 895 TITLE 26—INTERNAL REVENUE CODE § 179 extent not compensated for) paid or incurred pursuant to an agreement entered into under section 3121(l) with respect to services performed by United States citizens employed by foreign subsidiary corporations. Any reimbursement of any amount previously allowed as a deduction under this section shall be included in gross in- come for the taxable year in which received. (Added Sept. 1, 1954, ch. 1206, title II, § 210(a), 68 Stat. 1096.) [§ 177. Repealed. Pub. L. 99–514, title II, § 241(a), Oct. 22, 1986, 100 Stat. 2181] Section, added June 29, 1956, ch. 464, § 4(a), 70 Stat. 406; amended Oct. 4, 1976, Pub. L. 94–455, title XIX, § 1906(b)(13)(A), 90 Stat. 1834, related to deductions for trademark and trade name expenditures. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Pub. L. 99–514, title II, § 241(c), Oct. 22, 1986, 100 Stat. 2181, provided that: ‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section [amending sec- tions 312 and 1016 of this title and repealing this sec- tion] shall apply to expenditures paid or incurred after December 31, 1986. ‘‘(2) TRANSITIONAL RULE.—The amendments made by this section shall not apply to any expenditure in- curred— ‘‘(A) pursuant to a binding contract entered into before March 2, 1986, or ‘‘(B) with respect to the development, protection, expansion, registration, or defense of a trademark or trade name commenced before March 2, 1986, but only if not less than the lesser of $1,000,000 or 5 percent of the aggregate cost of such development, protection, expansion, registration, or defense has been incurred or committed before such date. The preceding sentence shall not apply to any expendi- ture with respect to a trademark or trade name placed in service after December 31, 1987.’’ § 178. Amortization of cost of acquiring a lease (a) General rule In determining the amount of the deduction allowable to a lessee for exhaustion, wear and tear, obsolescence, or amortization in respect of any cost of acquiring the lease, the term of the lease shall be treated as including all renewal options (and any other period for which the par- ties reasonably expect the lease to be renewed) if less than 75 percent of such cost is attrib- utable to the period of the term of the lease re- maining on the date of its acquisition. (b) Certain periods excluded For purposes of subsection (a), in determining the period of the term of the lease remaining on the date of acquisition, there shall not be taken into account any period for which the lease may subsequently be renewed, extended, or continued pursuant to an option exercisable by the lessee. (Added Pub. L. 85–866, title I, § 15(a), Sept. 2, 1958, 72 Stat. 1612; amended Pub. L. 99–514, title II, § 201(d)(2)(A), title XVIII, § 1812(c)(4)(B), Oct. 22, 1986, 100 Stat. 2139, 2835; Pub. L. 100–647, title I, § 1002(a)(9), Nov. 10, 1988, 102 Stat. 3354.) Editorial Notes AMENDMENTS 1988—Subsec. (a). Pub. L. 100–647 substituted ‘‘the de- duction allowable to a lessee for exhaustion, wear and tear, obsolescence, or amortization’’ for ‘‘the deduction allowable to a lessee of a lease for any taxable year for amortization under section 167, 169, 179, 185, 190, 193, or 194’’. 1986—Pub. L. 99–514, § 201(d)(2)(A), in amending sec- tion generally, substituted provision relating to amor- tization of cost of acquiring a lease, subsec. (a) setting out a general rule and subsec. (b) excluding certain pe- riods, for former provision for depreciation or amorti- zation of improvements made by lessee on lessor’s prop- erty, subsec. (a) setting out a general rule, subsec. (b), in case of related lessee and lessor, setting out a gen- eral rule in par. (1) and defining related persons in par. (2), and subsec. (c) setting out a reasonable certainty test. Subsec. (b)(2)(B). Pub. L. 99–514, § 1812(c)(4)(B), in- serted before the period ‘‘and subsection (f)(1)(A) of such section shall not apply’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 201(d)(2)(A) of Pub. L. 99–514 applicable to property placed in service after Dec. 31, 1986, in taxable years ending after such date, with ex- ceptions, see sections 203 and 204 of Pub. L. 99–514, set out as a note under section 168 of this title. Amendment by section 201(d)(2)(A) of Pub. L. 99–514 not applicable to any property placed in service before Jan. 1, 1994, if such property placed in service as part of specified rehabilitations, and not applicable to cer- tain additional rehabilitations, see section 251(d)(2), (3) of Pub. L. 99–514, set out as a note under section 46 of this title. Amendment by section 1812(c)(4)(B) of Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title. EFFECTIVE DATE Pub. L. 85–866, title I, § 15(c), Sept. 2, 1958, 72 Stat. 1613, provided that: ‘‘The amendments made by this section [enacting this section and amending analysis preceding section 161 of this title] shall apply with re- spect to costs of acquiring a lease incurred, and im- provements begun, after July 28, 1958 (other than im- provements which, on July 28, 1958, and at all times thereafter, the lessee was under a binding legal obliga- tion to make).’’ PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989 For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title. § 179. Election to expense certain depreciable business assets (a) Treatment as expenses A taxpayer may elect to treat the cost of any section 179 property as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the