Clarification: Chief Counsel Advice Concludes Equipment Held Primarily for Sale
To clarify the FEA Update issued on Thursday July 1, 2010, Chief Counsel Advice 201025049 found that the equipment in question was not “held for use in a trade or business or for investment” but rather the equipment was held primarily for sale. As such, the property was deemed ineligible for depreciation under IRC Section 167 and for tax-deferral under IRC Section 1031.
As noted, a Chief Counsel Advice is heavily dependent on the specific Taxpayer’s facts and circumstances. It is not binding on the IRS and may not be used or cited as precedent.*Information source FEA
