CHAPTER 516

An Act to amend the Code of Virginia by adding a section numbered
58-81.1, authorizing an accelerated amortization rate, upon certain
facilities designed to control pollution, for income tax purposes.

(S 272]
Approved April 5, 1954

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia be amended by adding a section numbered
58-81.1, as follows:
§ 58-81.1. (a) Every taxpayer, at his election, in lieu of the allow-
ance for depreciation set forth in § 58-81 (i), for any taxable year or part
thereof beginning after June 30, 1954, shall be entitled to a deduction with
respect to the amortization of the adjusted basis of any plant, equipment
or treatment system installed to prevent, reduce or abate pollution and
completed on or after July 1, 1946, pursuant to any order, directive or other
requirement or with the consent and approval of the State Water Control
Board, based on a period of sixty months. For the purposes of this section,
“adjusted basis” shall mean basis as determined by § 58-85 less deprecia-
tion allowed or allowable.

(b) Written notice of election to take amortization of any plant,
equipment or treatment system under this section must be filed with the
department of taxation on or before the filing date of the return for the
first taxable year for which such election under this section is made in
respect to such plant, equipment or system. Such notice shall be given on
such forms and in such manner as the department of taxation may by
rule prescribe.

(c) The taxpayer shall file with the department of taxation at the
time of his election under this section copies of recommendations, orders
and approvals issued by the State Water Control Board in respect to such
plant, equipment or treatment system, and such other documents and
data relating thereto as the department may by rule require.

(d) No deduction shall be allowed under this section on other than
depreciable property, except that where wastes are disposed of through
a lagoon process such lagooning costs and the cost of land containing such
lagoons shall be subject to the accelerated amortization provided for under
this section.

(e) In no event shall accelerated amortization, or depreciation and
accelerated amortization deductions be permitted in excess of the cost of
the asset subject to the provisions of this section.