§1013 — Basis of property included in inventory

We disagree with petitioner's position that section 1012 and the regulations thereunder are determinative of the cost of Consolidated's customer cores for purposes of section 471.

The regulations under section 1013 relating to the basis of property included in inventory make it clear that the amounts at which property must be reflected in a taxpayer’s inventories are controlled by section 471 and the regulations thereunder.

1013 (West 1982).7 Where fixtures are placed on leased premises for the purposes of trade (trade fixtures), however, a tenant has a limited right to remove those fixtures. We look to California Code section 1019 to define removable trade fixtures because the lease failed to provide a definition.8 Realty Dock & Improv. Corp. v. Anderson, 174 Ca

1013 (West 1982). However, where fixtures are placed on leased premises for the purposes of trade (i.e., trade fixtures), a tenant has a limited right to remove those fixtures. Section 1019 of the California Civil Code provides: A tenant may remove from the demised premises, any time during the continuance of his term, anything affixed thereto

Subs. v. Commissioner, 106 T.C. 1, 18-19 (1996), is clearly revealed by the following statement in the report of the House Ways and Means Committee at the time of the enactment of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100-647, sec. 1013(a)(34)(A), 102 Stat. 3342, 3544: The bill further deletes and re-inserts the term "necessary" in the specific regulatory authority granted the Treasury Department under the arbitrage restrictions. This amendment is intended to clarify that