Anti-Churning Rules

Anti-Churning Rules

Laws designed to prevent taxpayers from taking advantage of new laws by acquiring property eligible for benefits available under the new law from a related party that was used by the related property before the effective date of the new law. The term was first used when ACRS (Accelerated Cost Recovery System) was enacted in 1981. The term also applies to property eligible for MACRS depreciation (defined elsewhere) and to section 197 intangibles (defined elsewhere).
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3 (acquired company held not related to acquirer for purpose of anti-churning rules on the investment tax credit); Rev.
Taxpayers may elect to apply this provision to assets acquired after July 25, 1991.(7) Anti-churning rules prevent the taxpayer from converting existing intangible assets for which no deduction would be allowed in the absence of Section 197 into assets whose amortization would be deductible.
197 intangible acquisition was from a decedent, the anti-churning rules do not apply, and IRC Sec.
The IRS did not address whether the anti-churning rules under Sec.
197 anti-churning rules do not apply, they would be eligible for 15-year amortization.
197 anti-churning rules do not apply and the partnership can make reverse Sec.
197 anti-churning rules to a partnership basis step-up under Sec.
Anti-churning rules. The anti-churning rules prohibit taxpayers from claiming amortization from intangibles that were not amortizable before the enactment of Sec.
As long as the buyer is not related to the seller, there should be no problems with the anti-churning rules, since Sec.
Goodwill may be subject to anti-churning rules, but other intangibles will not.
197(f)(9) provides anti-churning rules to prevent such situations.
* As the World Churns: Avoiding Tax Planning Disaster by Avoiding Anti-Churning Rules