| ||At Long Last—The Final Section 467 Regulations |
James R. Shorter, Jr*
* Partner, Thacher Proffitt & Wood, New York, NY; Columbia University, B.A., 1968; Harvard Law School, J.D., 1975; New York University Law School, LL.M. in Taxation, 1979. This Article is a revised version of a paper previously presented at the August 6, 1999 meeting of the Capital Recovery and Leasing Committee of the ABA Tax Section.
1 See Reg §§ 1.467-1 to –9; Prop. Reg §§ 1.467-1 to –8, Fed. Reg. 27,834 (1996).
2 See Reg. § 1.467-9(a). The preamble to the Final 467 Regulations states that no inference should be drawn concerning the treatment of rental agreements entered into before the regulations are applicable, and the Service will, in appropriate circumstances, apply the provisions of section 467 requiring constant rental accrual to rental agreements entered into before June 3, 1996. See 64 Fed. Reg. 26850 (1999).
3 See Reg. § 1.467-9(c). This provision was intended to permit agreements entered into during the Interim Period to rely upon the safe harbors and other provisions of the proposed regulations in order to ensure that these agreements are not treated as Disqualified Leases. The preamble provides that no specific election is required in the case of an agreement subject to this provision. See 64 Fed. Reg. 26,850 (1999).