15 AAC 19.151. Property used for the production of business income

(a) Property must be included in the property factor if it is actually used or is available for or capable of being used during the tax period in the regular course of the trade or business of the taxpayer. Property held as reserves or standby facilities or property held as a reserve source of materials must be included in the factor. For example, a plant temporarily idle and raw material reserves not currently being processed are includable in the factor.

(b) Property or equipment under construction during the tax period (except inventoriable goods in process) must be excluded from the factor until that property is actually used in the regular course of the trade or business of the taxpayer. If the property is partially used in the regular course of the trade or business of the taxpayer while under construction, the value of the property to the extent used must be included in the property factor.

(c) Property used in the regular course of the trade or business of the taxpayer must remain in the property factor until its permanent withdrawal is established by an identifiable event such as its conversion to the production of nonbusiness income, its sale, or the lapse of an extended period of time (normally, five years) during which the property is held for sale.

History: Eff. 5/24/78, Register 66; am 3/31/82, Register 81

Authority: AS 43.05.080

AS 43.19.010

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