Plumbing Fixtures and Specialty Plumbing

Toilets, lavatories, domestic water risers, and building drains exist so people can occupy the building. Treas. Reg. §1.48-1(e)(2) lists plumbing and plumbing fixtures, such as sinks and bathtubs, among structural components, along with walls, partitions, floors, central HVAC, electric wiring, sprinkler systems, and other components relating to the operation or maintenance of a building. Tangible personal property excludes those items. A building is a roofed enclosure used for shelter, housing, or working, office, parking, display, or sales space. Local fixture law does not control.

Specialty plumbing is the piping that would be removed if the machine left: a dishwasher tailpiece, a grease line to a kettle, medical gases, deionized water, or a process drain. The restaurant matrix in Publication 5653 treats dedicated water, gas, and drain lines to kitchen equipment as section 1245 property grouped with the equipment. The pharmaceutical matrix treats special water, gas, and waste systems as personal property with an activity-class life. The residential matrix treats dedicated appliance plumbing hook-ups as following the appliances and kitchen sinks, counters, and cabinetry as residential rental building property. Those rows are examiner guidance for those industries.

Morrison is the leading kitchen-plumbing split in the case law the audit guide still cites. The Eleventh Circuit affirmed a Tax Court memorandum that allowed some equipment-related items and denied kitchen hand sinks, garbage rooms, floors, sanitary walls, and serving-line curbs as structural. Duaine, as summarized in the guide’s case table, treated plumbing and gas lines to equipment as section 1245 on those facts and kitchen wall and floor tiles as section 1250. Hospital Corp. of America classified hospital plumbing items one by one; the IRS did not acquiesce in the item results. AmeriSouth kept most special-plumbing claims with apartment buildings. Courts have split on kitchen and specialty piping depending on whether the run served occupancy or a machine.

Whiteco’s six permanence factors are a court test for inherently permanent structures, not a plumbing code. Buried site sewer laterals that serve the building are still building plumbing or, outside the building line, may be land improvements under class 00.3 as reproduced in Publication 946, unless an activity class specifically includes them (Rev. Rul. 2003-81). Underground vineyard irrigation in Trentadue v. Commissioner, 128 T.C. 91 (2007), was a land improvement because substantial piping was buried and hard to remove. That agriculture holding is analogical, not a restaurant grease-line class.

Scott Paper’s load-based split is an electrical case. Publication 5653 Chapter 8.A discusses functional allocation for primary and secondary electrical distribution. The guide does not accept that method as an IRS-approved allocation of plumbing. Restaurant matrices also say allocation of HVAC is not appropriate. A mixed domestic-water riser is not reclassed by applying a kitchen-load percentage to the whole stack.