§278 — Repealed. Pub. L. 99–514, title VIII, § 803(b)(6), Oct. 22, 1986, 100 Stat. 2356]
12 citing cases
Statute Text — 26 U.S.C. §278
[§ 278. Repealed. Pub. L. 99–514, title VIII, § 803(b)(6), Oct. 22, 1986, 100 Stat. 2356] Section, added Pub. L. 91–172, title II, § 216(a), Dec. 30, 1969, 83 Stat. 573; amended Pub. L. 91–680, § 1(a), (b), (d), Jan. 12, 1971, 84 Stat. 2064; Pub. L. 94–455, title II, § 207(b)(1), (2), Oct. 4, 1976, 90 Stat. 1538, related to capital expenditures incurred in planting and developing citrus and almond groves, and certain capital expenditures of farming syndicates. Statutory Notes and Related Subsidiaries Effective Date of RepealIf any interest costs incurred after Dec. 31, 1986, are attributable to costs incurred before Jan. 1, 1987, the repeal of this section is applicable to such interest costs only to the extent such interest costs are attributable to costs which were required to be capitalized under section 263 of the Internal Revenue Code of 1954 and which would have been taken into account in applying section 189 of the Internal Revenue Code of 1954 (as in effect before its repeal by section 803 of Pub. L. 99–514) or, if applicable, section 266 of such Code, see section 7831(d)(2) of Pub. L. 101–239, set out as an Effective Date note under section 263A of this title. Repeal applicable to costs incurred after Dec. 31, 1986, in taxable years ending after such date, except as otherwise provided, see section 803(d) of Pub. L. 99–514, set out as an Effective Date note under section 263A of this title.
Treasury Regulations
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Treas. Reg. §1.278-1Capital expenditures incurred in planting and developing citrus and almond groves
(a) General rule. (1)(i) Except as provided in subparagraph (2)(iii) of this paragraph and paragraph (b) of this section, there shall be charged to capital account any amount (allowable as a deduction without regard to section 278 or this section) which is attributable to the planting, cultivation, maintenance, or development of any citrus or almond grove (or part thereof), and which is incurred before the close of the fourth taxable year beginning with the taxable year in which the trees were planted. For purposes of section 278 and this section, such an amount shall be considered as “incurred” in accordance with the taxpayer's regular tax accounting method used in reporting income and expenses connected with the citrus or almond grove operation. For purposes of this paragraph, the portion of a citrus or almond grove planted in 1 taxable year shall be treated separately from the portion of such grove planted in another taxable year. The provisions of section 278 and this section apply to taxable years beginning after December 31, 1969, in the case of a citrus grove, and to taxable years beginning after January 12, 1971, in the case of an almond grove.
(ii) The provisions of this subparagraph may be illustrated by the following examples:
(2)(i) For purposes of section 278 and this section a citrus grove is defined as one or more trees of the rue family, often thorny and bearing large fruit with hard, usually thick peel and pulpy flesh, such as the orange, grapefruit, lemon, lime, citron, tangelo, and tangerine.
(ii) For purposes of section 278 and this section, an almond grove is defined as one or more trees of the species Prunus amygdalus.
(iii) An amount attributable to the cultivation, maintenance, or development of a citrus or almond grove (or part thereof) shall include, but shall not be limited to, the following developmental or cultural practices expenditures: Irrigation, cultivation, pruning, fertilizing, management fees, frost protection, spraying, and upkeep of the citrus or almond grove. The provisions of section 278(a) and this paragraph shall apply to expenditures for fertilizer and related materials notwithstanding the provisions of section 180, but shall not apply to expenditures attributable to real estate taxes or interest, to soil and water conservation expenditures allowable as a deduction under section 175, or to expenditures for clearing land allowable as a deduction under section 182. Further, the provisions of section 278(a) and this paragraph apply only to expenditures allowable as deductions without regard to section 278 and have no application to expenditures otherwise chargeable to capital account, such as the cost of the land and preparatory expenditures incurred in connection with the citrus or almond grove.
(iv) For purposes of section 278 and this section, a citrus or almond tree shall be considered to be “planted” on the date on which the tree is placed in the permanent grove from which production is expected.
(3)(i) The period during which expenditures described in section 278(a) and this paragraph are required to be capitalized shall, once determined, be unaffected by a sale or other disposition of the citrus or almond grove. Such period shall, in all cases, be computed by reference to the taxable years of the owner of the grove at the time that the citrus or almond trees were planted. Therefore, if a citrus or almond grove subject to the provisions of section 278 or this paragraph is sold or otherwise transferred by the original owner of the grove before the close of his fourth taxable year beginning with the taxable year in which the trees were planted, expenditures described in section 278(a) or this paragraph made by the purchaser or other transferee of the citrus or almond grove from the date of his acquisition until the close of the original holder's fourth such taxable year are required to be capitalized.
(ii) The provisions of this subparagraph may be illustrated by the following example:
(b) Exceptions. (1) Paragraph (a) of this section shall not apply to amounts allowable as deductions (without regard to section 278 or this section) and attributable to a citrus or almond grove (or part thereof) which is replanted by a taxpayer after having been lost or damaged (while in the hands of such taxpayer) by reason of freeze, disease, drought, pests, or casualty.
(2)(i) Paragraph (a) of this section shall not apply to amounts allowable as deductions (without regard to section 278 or this section), and attributable to a citrus grove (or part thereof) which was planted or replanted prior to December 30, 1969, or to an almond grove (or part thereof) which was planted or replanted prior to December 30, 1970.
(ii) The provisions of this subparagraph may be illustrated by the following examples:
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Treas. Reg. §1.278-1(a)General rule.
General rule. (1)(i) Except as provided in subparagraph (2)(iii) of this paragraph and paragraph (b) of this section, there shall be charged to capital account any amount (allowable as a deduction without regard to section 278 or this section) which is attributable to the planting, cultivation, maintenance, or development of any citrus or almond grove (or part thereof), and which is incurred before the close of the fourth taxable year beginning with the taxable year in which the trees were planted. For purposes of section 278 and this section, such an amount shall be considered as “incurred” in accordance with the taxpayer's regular tax accounting method used in reporting income and expenses connected with the citrus or almond grove operation. For purposes of this paragraph, the portion of a citrus or almond grove planted in 1 taxable year shall be treated separately from the portion of such grove planted in another taxable year. The provisions of section 278 and this section apply to taxable years beginning after December 31, 1969, in the case of a citrus grove, and to taxable years beginning after January 12, 1971, in the case of an almond grove.
(ii) The provisions of this subparagraph may be illustrated by the following examples:
(2)(i) For purposes of section 278 and this section a citrus grove is defined as one or more trees of the rue family, often thorny and bearing large fruit with hard, usually thick peel and pulpy flesh, such as the orange, grapefruit, lemon, lime, citron, tangelo, and tangerine.
(ii) For purposes of section 278 and this section, an almond grove is defined as one or more trees of the species Prunus amygdalus.
(iii) An amount attributable to the cultivation, maintenance, or development of a citrus or almond grove (or part thereof) shall include, but shall not be limited to, the following developmental or cultural practices expenditures: Irrigation, cultivation, pruning, fertilizing, management fees, frost protection, spraying, and upkeep of the citrus or almond grove. The provisions of section 278(a) and this paragraph shall apply to expenditures for fertilizer and related materials notwithstanding the provisions of section 180, but shall not apply to expenditures attributable to real estate taxes or interest, to soil and water conservation expenditures allowable as a deduction under section 175, or to expenditures for clearing land allowable as a deduction under section 182. Further, the provisions of section 278(a) and this paragraph apply only to expenditures allowable as deductions without regard to section 278 and have no application to expenditures otherwise chargeable to capital account, such as the cost of the land and preparatory expenditures incurred in connection with the citrus or almond grove.
(iv) For purposes of section 278 and this section, a citrus or almond tree shall be considered to be “planted” on the date on which the tree is placed in the permanent grove from which production is expected.
(3)(i) The period during which expenditures described in section 278(a) and this paragraph are required to be capitalized shall, once determined, be unaffected by a sale or other disposition of the citrus or almond grove. Such period shall, in all cases, be computed by reference to the taxable years of the owner of the grove at the time that the citrus or almond trees were planted. Therefore, if a citrus or almond grove subject to the provisions of section 278 or this paragraph is sold or otherwise transferred by the original owner of the grove before the close of his fourth taxable year beginning with the taxable year in which the trees were planted, expenditures described in section 278(a) or this paragraph made by the purchaser or other transferee of the citrus or almond grove from the date of his acquisition until the close of the original holder's fourth such taxable year are required to be capitalized.
(ii) The provisions of this subparagraph may be illustrated by the following example:
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Treas. Reg. §1.278-1(b)Exceptions.
Exceptions. (1) Paragraph (a) of this section shall not apply to amounts allowable as deductions (without regard to section 278 or this section) and attributable to a citrus or almond grove (or part thereof) which is replanted by a taxpayer after having been lost or damaged (while in the hands of such taxpayer) by reason of freeze, disease, drought, pests, or casualty.
(2)(i) Paragraph (a) of this section shall not apply to amounts allowable as deductions (without regard to section 278 or this section), and attributable to a citrus grove (or part thereof) which was planted or replanted prior to December 30, 1969, or to an almond grove (or part thereof) which was planted or replanted prior to December 30, 1970.
(ii) The provisions of this subparagraph may be illustrated by the following examples:
12 Citing Cases
of limitations to 4 years. The Revenue Act of 1924 (Pub. L. 68-176, 43 Stat. 253, 299) kept the 4-year general statute of limitations, as section 277(a)(1); it provided that there.was no limit in the case of fraud or failure to file a tax return, as section 278(a). Section 277(a)(1) of the Revenue Act of 1926 (Pub. L. 69-20, 44 Stat. 9, 58, 59) reduced the general period of limitations to 3 years; the 1926 Act left unchanged the fraud and failure-to- file rule. Section 275(a) of the Revenue Act
The notice of deficiency in the instant case was issued, and the petition was filed, in 1999, within 3 years of dissolution, giving us jurisdiction. See Bared & Cobo Co., Inc. v. Commissioner, 77 T.C. 1194 (1981). Hereinafter, references to petitioner are to WSB Liquidating Corp. or Walter S. Bandurski, Inc. Following concessions b
of limitations to 4 years. The Revenue Act of 1924 (Pub. L. 68-176, 43 Stat. 253, 299) kept the 4-year general statute of limitations, as section 277(a)(1); it provided that there was no limit in the case of fraud or failure to file a tax return, as section 278(a). Section 277(a)(1) of the Revenue Act of 1926 (Pub. L. 69-20, 44 Stat. 9, 58, 59) reduced the general period of limitations to 3 years; the 1926 Act 'left unchanged the fraud and failure-to- file rule. Section 275(a) of the Revenue Act
Respondent also points out that section 263A(d)(3)(C) is similar to former section 278 and reflects that Congress considered the preproductive period for citrus trees to be more than 2 years.7 Subsection (d) of section 263A provides for exceptions from the capitalization requirements for certain farming businesses.
Respondent also points out that section 263A(d)(3)(C) is similar to former section 278 and reflects that Congress considered the preproductive period for citrus trees to be more than 2 years.
Also, at the time this issue was raised, respondent was foreclosed from - 44 - examining the cotrustees and the guardian ad litem about the various factual elements of the definition of qualified disclaimer under section 2518(b) and section 278 of the California Probate Code.