[Code of Federal Regulations]
[Title 26, Volume 3]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.280F-1T]

[Page 627-628]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
COMPUTATION OF TAXABLE INCOME (Continued)--Table of Contents
 
Sec. 1.280F-1T  Limitations on investment tax credit and recovery deductions under section 168 for passenger automobiles and certain other listed property; 
          overview of regulations (temporary).

    (a) In general. Section 280F(a) limits the amount of investment tax 
credit determined under section 46(a) and recovery deductions under 
section 168 for passenger automobiles. Section 280F(b) denies the 
investment tax credit and requires use of the straight line method of 
recovery for listed property that is not predominantly used in a 
qualified business use. In certain circumstances, section 280F(b) 
requires the recapture of an amount of cost recovery deductions 
previously claimed by the taxpayer. Section 280F(c) provides that 
lessees are to be subject to restrictions substantially equivalent to 
those imposed on owners of such property under section 280F (a) and (b). 
Section 280F(d) provides definitions and special rules; note that 
section 280F(d) (2) and (3) apply with respect to all listed property, 
even if the other provisions of section 280F do not affect the treatment 
of the property.
    (b) Key to Code provisions. The following table identifies the 
provisions of section 280F under which regulations are provided, and 
lists each provision below with its corresponding regulation section:


                                                                       Sections 1.280F-5T and
      Section 1.280F-2T         Section 1.280F-3T   Section 1.280F-4T         1.280F-7         Section 1.280F-6T

             (a)                       (b)               (d)(2)                  (c)                 (d)(3)
            (d)(1)                   (d)(1)        ..................  ......................        (d)(4)
            (d)(8)             ..................  ..................  ......................        (d)(5)
           (d)(10)             ..................  ..................  ......................        (d)(6)



Sections 1.280F-2T(f) and 1.280F-4T(b) also provide special rules for 
improvements to passenger automobiles and other listed property that 
qualify as capital expenditures.
    (c) Effective dates--(1) In general. This section and Secs. 1.280F-
2T through 1.280F-6T apply to property placed in service or leased after 
June 18, 1984, in taxable years ending after that date. Section 1.280F-7 
applies to property leased after December 31, 1986, in taxable years 
ending after that date.
    (2) Exception. This section and Secs. 1.280F-2T through 1.280F-6T 
shall not apply to any property:
    (i) Acquired pursuant to a binding contract in effect on June 18, 
1984, and at all times thereafter, or under construction by the taxpayer 
on that date, but only if the property is placed in service before 
January 1, 1985 (January 1, 1987, in the case of 15-year real property), 
or
    (ii) Leased pursuant to a binding contract in effect on June 18, 
1984, and at all times thereafter, but only if the lessee first uses 
such property under the lease before January 1, 1985 (January 1, 1987, 
in the case of 15-year real property).
    (3) Leased passenger automobiles. Section 1.280F-5T(e) generally 
applies to passenger automobiles leased after April 2, 1985, and before 
January 1, 1987, in taxable years ending after April 2,

[[Page 628]]

1985. Section 1.280F-5T(e) generally applies to passenger automobiles 
leased after April 2, 1985, in taxable years ending after that date. 
Section 1.280F-5T(e) does not apply to any passenger automobile that is 
leased pursuant to a binding contract, which is entered into no later 
than April 2, 1985, and which is in effect at all times thereafter, but 
only if the automobile is used under the lease before August 1, 1985. If 
Sec. 1.280F-5T(e) does not apply to a passenger automobile, see 
paragraph (c) (1) and (2) of this section. Section 1.280F-7(a) applies 
to passenger automobiles leased after December 31, 1986, in taxable 
years ending after that date.

[T.D. 7986, 49 FR 42704, Oct. 24, 1984; as amended by T.D. 8061, 50 FR 
46038, Nov. 6, 1985; T.D. 8218, 53 FR 29881, Aug. 9, 1988; T.D. 8473, 58 
FR 19060, Apr. 12, 1993]