Pepcol Manufacturing Co. v. Commissioner

GOODWIN, Circuit Judge.

The Commissioner of Internal Revenue appeals the decision by the Tax Court reversing the Commissioner’s decision that Pepcol Manufacturing Co. (“Pepcol”) had taken an unauthorized “energy” investment credit which resulted in a $138,340 income tax deficiency for the 1980 year. We review this question of statutory construction as a question of law, and reverse.

The appeal presents two questions: (1) whether taxpayer’s specialized manufacturing equipment qualifies as “recycling equipment” under I.R.C. section 48(l)(6); and (2) The effect of a Treasury Regulation that…