(See Section 23649-0 for Table of Contents.) For purposes of Regulations 23649-1 through 23649-11, inclusive, the following definitions shall apply:
If qualified property meets the conditions of subsection (i)(2) of this regulation in any income year, it shall be considered placed in service in such year, notwithstanding that the period for depreciation with respect to the qualified property begins in a succeeding income year. For example, if under the qualified taxpayer's California depreciation practice such qualified property is accounted for in a multiple asset account and depreciation is computed under an averaging convention, or depreciation is computed under the completed contract method, the unit of production method, or the retirement method, then the qualified property is treated as in a condition or state of readiness and availability for a specifically assigned function. Specific examples where qualified property shall be considered in a condition or state of readiness and available for a specifically assigned function include (A) parts that are acquired and set aside during the income year for use as replacements for a particular item or items of qualified property in order to avoid operational time loss, (B) operational items of qualified property that are acquired for a specifically assigned function during the income year where it is not practicable to use such item of qualified property for its specifically assigned function in the qualified taxpayer's business until the following income year, and (C) qualified property acquired for a specifically assigned function that is operational but is still undergoing testing to eliminate any defects. Materials and parts acquired to be used in the construction of an item of qualified property shall not be considered in a condition or state of readiness and availability for a specifically assigned function.
Cal. Code Regs. Tit. 18, §§ 23649-2
2. Change without regulatory effect repealing subsection (b), relettering subsections, adding new subsection (g), and amending subsections (l) and (t) filed 8-14-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 33).
Note: Authority cited: Section 19503, Revenue and Taxation Code. Reference: Section 23649, Revenue and Taxation Code.
2. Change without regulatory effect repealing subsection (b), relettering subsections, adding new subsection (g), and amending subsections ( l) and (t) filed 8-14-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 33).