Significance
This case deals with the costs and tax consequences related to producing real and tangible personal property, when a taxpayer constructs property instead of purchasing it. This result was codified in §263A of the Internal Revenue Code (known as the uniform capitalization rules or the Unicap rules). This requires the capitalization of all direct and indirect costs allocable to the construction or production of real property or tangible personal property. It also applies to the acquisition of inventory materials and wages paid to builders or other production workers.
Direct costs include raw materials and wages paid to builders or other production workers. Treas. Reg. §1.263A-1(e)(2).
Indirect costs include repairs, depreciation, utilities, rent, sales tax, property tax, insurance, storage, and packaging. Treas. Reg. §1.263A-1(e)(3).
Read more about this topic: Commissioner V. Idaho Power Co.
Famous quotes containing the word significance:
“I am not afraid that I shall exaggerate the value and significance of life, but that I shall not be up to the occasion which it is.”
—Henry David Thoreau (1817–1862)
“The hysterical find too much significance in things. The depressed find too little.”
—Mason Cooley (b. 1927)
“The hypothesis I wish to advance is that ... the language of morality is in ... grave disorder.... What we possess, if this is true, are the fragments of a conceptual scheme, parts of which now lack those contexts from which their significance derived. We possess indeed simulacra of morality, we continue to use many of the key expressions. But we have—very largely if not entirely—lost our comprehension, both theoretical and practical, of morality.”
—Alasdair Chalmers MacIntyre (b. 1929)