![]() The determination of whether an individual materially participates in any activity shall be made in a manner similar to the manner in which such determination is made under section 2032A(e)(6). (ii) such other person holds any part of the remaining equity interest and materially participates in the planting, maintenance, cultivation, or development of the plants described in subparagraph (A) during the taxable year in which such amounts were paid or incurred. (i) the taxpayer described in subparagraph (A) has an equity interest of more than 50 percent in the plants described in subparagraph (A) at all times during the taxable year in which such amounts were paid or incurred, and Subparagraph (A) shall apply to amounts paid or incurred by a person (other than the taxpayer described in subparagraph (A)) if. (B) Special rule for person with minority interest who materially participates. If plants bearing an edible crop for human consumption were lost or damaged (while in the hands of the taxpayer) by reason of freezing temperatures, disease, drought, pests, or casualty, this section shall not apply to any costs of the taxpayer of replanting plants bearing the same type of crop (whether on the same parcel of land on which such lost or damaged plants were located or any other parcel of land of the same acreage in the United States). (2) Treatment of certain plants lost by reason of casualty. Subparagraph (A) shall not apply to any corporation, partnership, or tax shelter required to use an accrual method of accounting under section 447 or 448(a)(3). (B) Exception for taxpayers required to use accrual method. (ii) Any plant which has a preproductive period of 2 years or less. This section shall not apply to any of the following which is produced by the taxpayer in a farming business: (1) Section not to apply to certain property. This section shall not apply to any amount allowed as a deduction by reason of section 168(k)(5) (relating to special rules for certain plants bearing fruits and nuts). Paragraphs (2) and (3) shall apply to any amount allowable as a deduction under section 59(e) for qualified expenditures described in subparagraphs (B), (C), (D), and (E) of paragraph (2) thereof. (B) any real property underlying such trees. (A) trees raised, harvested, or grown by the taxpayer other than trees described in clause (ii) of subsection (e)(4)(B) (after application of the last sentence thereof), and ![]() This section shall not apply to any property produced by the taxpayer pursuant to a long-term contract. (4) Coordination with long-term contract rules. ![]() This section shall not apply to any cost allowable as a deduction under section 167(h), 179B, 263(c), 263(i), 291(b)(2), 616, or 617. (3) Certain development and other costs of oil and gas wells or other mineral property. This section shall not apply to any amount allowable as a deduction under section 174. (2) Research and experimental expenditures. This section shall not apply to any property produced by the taxpayer for use by the taxpayer other than in a trade or business or an activity conducted for profit. Real or personal property described in section 1221(a)(1) which is acquired by the taxpayer for resale.įor purposes of paragraph (1), the term "tangible personal property" shall include a film, sound recording, video tape, book, or similar property. Real or tangible personal property produced by the taxpayer. Except as otherwise provided in this section, this section shall apply to. (B) such property's proper share of those indirect costs (including taxes) part or all of which are allocable to such property.Īny cost which (but for this subsection) could not be taken into account in computing taxable income for any taxable year shall not be treated as a cost described in this paragraph. (A) the direct costs of such property, and The costs described in this paragraph with respect to any property are. (B) in the case of any other property, shall be capitalized. (A) in the case of property which is inventory in the hands of the taxpayer, shall be included in inventory costs, and In the case of any property to which this section applies, any costs described in paragraph (2). (a) Nondeductibility of certain direct and indirect costs.
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