[Code of Federal Regulations]
[Title 26, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.187-2]

[Page 254-255]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.187-2  Definitions.

    (a) Certified coal mine safety equipment--(1) In general--(i) The 
term certified coal mine safety equipment means property which:
    (a) Is electric face equipment (within the meaning of section 305 of 
the Federal Coal Mine Health and Safety Act of 1969) required in order 
to meet the requirements of section 305(a)(2) of such Act,
    (b) The Secretary of the Interior or the Director of the Bureau of 
Mines certifies is permissible within the meaning of such section 
305(a)(2), and
    (c) Is placed in service (as defined in subparagraph (2)(i) of this 
paragraph) before January 1, 1975.
    (ii) In addition, property placed in service in connection with any 
used electric face equipment which the Secretary of the Interior or the 
Director of the Bureau of Mines certifies makes such used electric face 
equipment permissible shall be treated as a separate item of certified 
coal mine safety equipment. See subparagraph (2)(ii) of this paragraph.
    (2) Meaning of terms. (i) For purposes of subparagraph (1)(i)(c) of 
this paragraph, the term placed in service shall have the meaning 
assigned to such term in paragraph (d) of Sec. 1.46-3.
    (ii) For purposes of subparagraph (1)(ii) of this paragraph, the 
term property includes those costs of converting existing nonpermissible 
electric face equipment to a permissible condition which are chargeable 
to capital account under the principles of Sec. 1.1016-2. Property is 
considered to be placed in service in connection with used electric face 
equipment (which was not permissible) if its use causes such electric

[[Page 255]]

face equipment to be certified as permissible.
    (b) Adjusted basis--(1) In general. The basis upon which the 
deduction with respect to amortization allowed by section 187 is to be 
computed with respect to any item of certified coal mine safety 
equipment shall be the adjusted basis provided in section 1011 for the 
purpose of determining gain on the sale or other disposition of such 
property (see part II (section 1011 and following) subchapter O, chapter 
1 of the Code) computed as of the first day of the amortization period. 
For an example showing the determination of the adjusted basis referred 
to in the preceding sentence in the case where the amortization period 
begins with the taxable year succeeding the taxable year in which the 
property is placed in service see Example 3 in paragraph (d) of Sec. 
1.187-1.
    (2) Capital additions. The adjusted basis of any certified coal mine 
safety equipment, with respect to which an election is made under 
section 187(b), shall not be increased, for purposes of section 187, for 
amounts chargeable to the capital account for additions or improvements 
after the amortization period has begun. However, nothing contained in 
this section or Sec. 1.187-1 shall be deemed to disallow a deduction 
for depreciation for such capital additions. Thus, for example, if a 
taxpayer places a piece of certified coal mine safety equipment in 
service in 1971 and in 1972 makes improvements to it the expenditures 
for which are chargeable to the capital account, such improvements shall 
not increase the adjusted basis of the equipment for purposes of 
computing the amortization deduction allowed by section 187(a). However, 
the depreciation deduction provided by section 167 shall be allowed with 
respect to such improvements in accordance with the principles of 
section 167.

[T.D. 7137, 36 FR 14734, Aug. 11, 1971; 36 FR 19251, Oct. 1, 1971]