SECTION 4. RETAIL MOTOR FUELS

OUTLET ELECTION

.01 In general. A taxpayer may elect to treat § 1250 property within the scope of this revenue procedure as 15year property for § 168 purposes. This election may be made separately for each property and, once made, is irrevocable.

.02 Effect of election. If a taxpayer makes the retail motor fuels outlet election, the taxpayer must change to a permissible depreciation method, recovery period, and convention under § 168 for the property. Under the general depreciation system of § 168(a), 15-year property generally is depreciated by using the 150-percent declining balance method of depreciation and a 15-year recovery period. Under the alternative depreciation system of § 168(g), a retail motor fuels outlet is depreciated by using the straight-line method of depreciation and a 20-year recovery period. Under both depreciation systems, the convention is the half-year convention unless the mid-quarter convention ap

(1) Amount of § 481(a) adjust- ment. The § 481(a) adjustment may be a positive § 481(a) adjustment (increase in taxable income) or negative § 481(a) adjustment (decrease in taxable income). The adjustment equals the difference between the total amount of depreciation taken into account in computing taxable income for the property under the taxpayer’s present method of accounting, and the total amount of depreciation allowable for the property under the taxpayer’s proposed method of accounting, for any taxable year prior to the year of change. However, if the taxpay

plies. The retail motor fuels outlet election does not revoke any elections previously made by the taxpayer under § 168 or enable the taxpayer to make a late election to use the straight-line method or the alternative depreciation system. However, if the taxpayer has no other 15-year property (as defined under §§ 168(e)(1) and 168(e)(3)(E)(i) and (ii)) that was placed in service during the same taxable year as the retail motor fuels outlet, the taxpayer may elect to use the straight-line method or the alternative depreciation system for the retail motor fuels outlet.

The retail motor fuels outlet election also requires the taxpayer to use a 20-year recovery period and the straightline method for the property for alternative minimum tax purposes. See § 168(g)(3)(B).