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As noted in the June, 1996 Federal Tax Topics, the Seventh Circuit in Walgreen Co., 76 AFTR 2d 95-6851, 95-2 USTC Par. 50,562 (CA-7, 1995) held that various leasehold improvements might be depreciable as wholesale and retail trade property. I his would result in a five-year lie under the current depreciation system (MACRS). The Seventh Circuit remanded the case back to the Tax Court to determine which of Walgreen's leasehold improvement could be depreciated over the short useful life.
In Walgreen Co., TC Memo 1996374, the Tax Court made its factual determinations. The Seventh Circuit had held that Class 57.0, Wholesale and Retail trade assets (that...