SECTION 4. EFFECT OF ELECTION

.01 In general . If a taxpayer makes a general asset account election under this revenue procedure, the taxpayer consents to, and agrees to apply, all of the provisions of § 1.168(i)–1 to the property subject to the election, beginning with the year of change. Thus, pursuant to § 1.168(i)–1(k)(1), the election generally is irrevocable and will be binding on the taxpayer for computing taxable income for the year of change and for all subsequent taxable years. The election has no effect on the depreciation method, recovery period, and convention of the property.

.02 Establishment of general asset accounts. Any property subject to a general asset account election under this revenue procedure must be grouped into one or more general asset accounts in accordance with the rules in § 1.168(i)– 1(c) and separate from any account formed in any taxable year prior to the year of change. In addition, each general asset account must include a beginning balance for both the unadjusted depreciable basis and the depreciation reserve of the general asset account. The beginning balance for the unadjusted depreciable basis of the general asset account is equal to the sum of the unadjusted depreciable bases as of the beginning of the year of change for all property included in the general asset account. The beginning balance of the depreciation reserve of the general asset account is equal to the sum of the depreciation allowed or allowable, whichever is greater, as of the end of the taxable year immediately preceding the year of change for all property included in the general asset account.