United States Federal Circuit

In a suit seeking a refund of corporate income tax after a settlement pursuant to which the IRS allowed the taxpayer to deduct 50% and capitalize 50% of the amount of debt incurred when it was replacing coal burners in two of its plants, the Court of Federal Claims grant of summary judgment to the US is reversed, where: 1) the associated property rule in Treasury Regulation section 1.263A-11(e)(1)(ii)(B) as applied to property temporarily withdrawn from service is not a reasonable interpretation of IRC section 263A; and 2) the Treasury acted contrary to 5 U.S.C. section 706(2) in failing to provide a reasoned explanation when it promulgated that regulation.

Appellate Information

• Decided 05/31/2012
• Published 05/31/2012

Judges

• Rader

Court

• United States Federal Circuit

Counsel

• For Appellant:
  
• Eric R. Fox, Karen G. Gregory