Atlantic Veneer Corporation v. Commissioner of Internal Revenue

CHAPMAN, Circuit Judge:

Taxpayer has appealed the Tax Court’s decision, 85 T.C. 1075, upholding the Commissioner's denial of depreciation deductions arising out of taxpayer’s interest in a foreign partnership. The Commissioner denied the deductions because taxpayer took the deductions from a stepped-up basis, despite the apparent absence of an election under § 754 1 , which permits taxpayers pursuant to § 743(b) to take a step-up in basis resulting from the transfer of interest in a partnership by sale or exchange. We affirm the Tax Court, holding that, despite the somewhat confusing statutory…