§263A. Capitalization and inclusion in inventory costs of certain expenses — Inbound Citations
26 U.S.C. § 263A
Cited by 32 provisions in release 119-102.
Citations to 26 U.S.C. § 263A as a whole
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(III) is subject to section 263A, and
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(II) is not required to capitalize indirect costs under section 263A,
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(B) This subsection shall be applied before the application of section 263A (relating to capitalization of certain expenses where taxpayer produces property).
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(B) This section shall be applied before the application of section 263A (relating to capitalization of certain expenses where taxpayer produces property).
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(1) Notwithstanding subsection (a) or section 263A, if—(A) for its 10 taxable years ending with its first taxable year beginning after December 31, 1975, a corporation or qualified partnership used an annual accrual method of accounting with respect to its trade or business of farming,(B) such corporation or qualified partnership raises crops which are harvested not less than 12 months after planting, and(C) such corporation or qualified partnership has used such method of accounting for all taxable years intervening between its first taxable year beginning after December 31, 1975, and the taxable year,such corporation or qualified partnership may continue to employ such method of accounting for the taxable year with respect to its qualified farming trade or business.
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(A) any residential construction contract, or(B) any other construction contract entered into by a taxpayer (other than a tax shelter prohibited from using the cash receipts and disbursements method of accounting under section 448(a)(3))—(i) who estimates (at the time such contract is entered into) that such contract will be completed within the 2-year period beginning on the contract commencement date of such contract, and(ii) who meets the gross receipts test of section 448(c) for the taxable year in which such contract is entered into.In the case of a residential construction contract with respect to which the requirements of clauses (i) and (ii) of subparagraph (B) (determined by substituting “3-year” for “2-year” in subparagraph (B)(i) for any residential construction contract which is not a home construction contract) are not met, section 263A shall apply notwithstanding subsection (c)(4) thereof.
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(1) The rules of sections 263(g), 263A, and 1256(a) shall not apply to securities to which subsection (a) applies, and section 1091 shall not apply (and section 1092 shall apply) to any loss recognized under subsection (a).
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(aa) with respect to an eligible component, the total direct material costs that are paid or incurred (within the meaning of section 461 and any regulations issued under section 263A) by the taxpayer for production of such eligible component, minus
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(bb) with respect to an eligible component, the total direct material costs that are paid or incurred (within the meaning of section 461 and any regulations issued under section 263A) by the taxpayer for production of such eligible component that are mined, produced, or manufactured by a prohibited foreign entity, divided by
Citations to §263A(c)(5)
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(B) The term “farming business” includes the raising, harvesting, or growing of trees to which section 263A(c)(5) applies.
Citations to §263A(e)(1)
Citations to §263A(e)(2)
Citations to §263A(e)(3)
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(II) any plant with a preproductive period (as defined in section 263A(e)(3)) of 2 years or less, and
Citations to §263A(e)(4)
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(i) a farming business (as defined in section 263A(e)(4)) which makes an election under this subparagraph, or
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(vii) any machinery or equipment (other than any grain bin, cotton ginning asset, fence, or other land improvement) which is used in a farming business (as defined in section 263A(e)(4)), the original use of which commences with the taxpayer after December 31, 2017, and
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(A) In the case of any specified plant which is planted or grafted by the taxpayer in the ordinary course of the taxpayer’s farming business (as defined in section 263A(e)(4)) during a taxable year for which the taxpayer has elected the application of this paragraph—(i) a depreciation deduction equal to 100 percent of the adjusted basis of such specified plant shall be allowed under section 167(a) for the taxable year in which such specified plant is so planted or grafted, and(ii) the adjusted basis of such specified plant shall be reduced by the amount of such deduction.
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(I) the amount which would be the net operating loss for the taxable year if only income and deductions attributable to farming businesses (as defined in section 263A(e)(4)) are taken into account, or
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(A) The term “farming business” means the trade or business of farming (within the meaning of section 263A(e)(4)).
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(i) The term “farming business” has the meaning given such term in section 263A(e)(4).
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(3) The term “farming business” has the meaning given such term by section 263A(e)(4).
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(ii) The amount of any net earnings from self-employment (as defined in section 1402(a)), wages (as defined in section 3121(a) or 3401(a)), and taxable income from a farming business (as defined in section 263A(e)(4)).
Citations to §263A(f)
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(5) For purposes of this subsection, the term “business interest” means any interest paid or accrued on indebtedness properly allocable to a trade or business. Such term shall not include investment interest (within the meaning of subsection (d)). Such term shall not include any interest which is capitalized under section 263(g) or 263A(f).
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(IV) meets the requirements of clause (iii) of section 263A(f)(1)(B) (determined as if such clause also applies to property which has a long useful life (within the meaning of section 263A(f))).
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(B) In applying section 263A(f) for purposes of subparagraph (A), the production period shall be the period—(i) beginning on the later of—(I) the contract commencement date, or(II) in the case of a taxpayer who uses an accrual method with respect to long-term contracts, the date by which at least 5 percent of the total estimated costs (including design and planning costs) under the contract have been incurred, and(ii) ending on the contract completion date.
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(C) In applying section 263A(f) for purposes of subparagraph (A), paragraph (1)(B)(iii) of such section shall be applied on a contract-by-contract basis; except that, in the case of a taxpayer described in subparagraph (B)(i)(II) of this paragraph, paragraph (1)(B)(iii) of section 263A(f) shall be applied on a property-by-property basis.
Citations to §263A(f)(1)(B)(iii)
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(IV) meets the requirements of clause (iii) of section 263A(f)(1)(B) (determined as if such clause also applies to property which has a long useful life (within the meaning of section 263A(f))).
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(C) In applying section 263A(f) for purposes of subparagraph (A), paragraph (1)(B)(iii) of such section shall be applied on a contract-by-contract basis; except that, in the case of a taxpayer described in subparagraph (B)(i)(II) of this paragraph, paragraph (1)(B)(iii) of section 263A(f) shall be applied on a property-by-property basis.
Citations to §263A(f)(4)(B)
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(C) The term “construction period” has the meaning given the term production period under section 263A(f)(4)(B).2
Citations to §263A(h)
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(I) with respect to which expenses are treated as qualified creative expenses to which section 263A(h) applies,
Citations to §263A(i)(2)
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(II) to which a simplified procedure established under section 263A(i)(2)1 applies, or