The opinion
ArtjNdell :
The respondent has determined a deficiency of $214.13 in income tax for the year 1920 and a deficiency of $476.50 in income and excess profits taxes for the year 1921. The issue is whether respondent erred in increasing taxable income by $2,154.22 and $6,726.74, in the respective years due to the disallowance in part of claimed deductions for depreciation.
During the taxable years petitioner, a New Jersey corporation engaged in the dyeing and finishing business, owned and used in its business a building of frame and stucco construction, a brick boiler house, office furniture and fixtures, all of which had been acquired second hand, certain heavy machinery used in dyeing and finishing, about one-half of which was new and the balance old and a certain number of auto trucks. The parties have stipulated the value of the property for depreciation purposes and we find that depreciation thereon should be allowed for the taxable years at the following rates:
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The rates fixed are in accordance with the uncontradicted testimony of petitioner’s witness, with the exception of the rate on machinery, on which he fixed a composite rate of 25 per cent, which seems to us to be unreasonable in view of the fact that a considerable portion of the machinery had a life very much longer than four years and was still in use when the testimony in this case was taken. The rate of depreciation as fixed by the respondent for the machinery will not therefore be disturbed.
Decision will be entered under Bule 50.