Is the inventory manager asleep or what? The comments regarding GM-VOMS in your January issue were apparently made by someone who is uninformed.

Anyone who writes or speaks "candidly but insists on anonymity" is a coward.

One-ton chassis cabs are not generated unless consented to by the dealer, but are available on patterns for trade. This was a problem 6-8 months ago, but not recently.

We never have been able to "place a sold order." It, under the old system, sat in the order bank until we earned an allocation and there were no constraints on the order.

We shall be able to put sold orders in the VOMS system in late second quarter 2000. Even after that, our "order placement" will be based on allocation availability. Allocations are not determined entirely by our sales rate versus the nation's sales rate.

If this dealer's sales or inventory manager is as asleep as it appears, it seems that someone else should be hired.

Tommy Brasher Brasher Motor Co. Chevrolet-Buick Weimar, TX

NADA tries to "educate" Internal Revenue Service We read with interest the article entitled "Two tax perks under fire: Parts LIFO, tool rentals," which appeared in the November, 1999 edition. We were particularly interested in the comments of speakers at the Michigan Association of CPAs conference regarding parts LIFO. While we share many of the concerns expressed in the article, we wish to clarify a few points.

Most automobile dealerships on LIFO for parts have long used manufacturer-to-dealer pricing in effect at year-end to determine the "current-year cost of items" in the ending inventory.

Dealerships use this so-called replacement cost method because the manufacturers supply their current price data to dealerships in an electronic format which they are able to load onto their computer systems.

Conversely, actual invoice cost of the items is not available to the dealerships electronically. Perhaps in recognition of this commercial exigency, the IRS has previously approved the use of replacement cost in private letter rulings in 1975 and 1989.

We wholeheartedly agree that the tax court's ruling in Mountain State Ford throws a "monkey wrench" into established and long-accepted dealership tax accounting practices. The suggestion, however, that NADA has taken an unrealistic stance in its negotiations with the IRS is puzzling.

The tax court's opinion allows that the code and regulations permit a method that provides a reasonable approximation of actual cost, provided the commissioner finds that the method clearly reflects income.

We have invited the IRS to make such a finding in conjunction with a method dealerships realistically can implement using data on hand in dealership computer systems - a practical and sensible solution to the problem.

Even if the IRS should ultimately decline this opportunity to resolve the matter, it would have been imprudent to bypass the IRS in seeking a solution. Many field agents are aware of the tax court case and might well apply its revisionist view of parts LIFO. To sit back and wait for the outcome of an appeal, which carries no guarantee of success, and hope that taxpayers could fend off auditors by factually distinguishing Mountain State from their cases, would have been decidedly unwise.

We have had the opportunity, through dialogue, to educate the IRS on the practical business problems the tax court's ruling presents.

Asking the IRS to provide relief in the form of a realistic and workable method does not preclude an appeal by Mountain State Ford, nor does it preclude congressional action.

James C. Minnis NADA Director, Regulatory Affairs McLean, VA