Tax policy makers and academics in the United States traditionally focus on tax systems based on income and consumption. As a necessary adjunct to these fundamental tax base structural principles, these commentators have adopted complementary accounting principles in order to identify and compute the amounts of income and consumption to be taxed during a designated taxable period. For example, most economists and tax policy commentators assert that an accretion-measured income tax comprehensively and accurately measures economic income. Most commentators also accept the proposition that a tax based on income but measured only by cash flows (a cash flow income tax) is a practical surrogate for a theoretical consumption tax. Following these traditions, this article assumes that an accretion-measuredincome tax (AMIT), and a cash-flow measured income tax (CFIT) are pure taxbase paradigms in which the paired tax base structural and accounting principlestheoretically complement each other.The U.S. income tax base, however, employs structural and accounting principles that differ from both the AMIT and CFIT base paradigms. Like an AMIT base, the U.S. income tax purports to tax “income” as opposed to “consumption;” but unlike an AMIT base, it does not as a general rule employ accretion accounting in order to measure “income.” Similarly, unlike a tax on consumption that is measured by cash flows, the U.S. income tax is not fundamentally structured to tax consumption; nor does it use cash flow accounting as the primary means of measuring the “income” that it taxes.With respect to capital income taxation in general, the U.S. income tax base may be characterized as a realization-based income tax (RBIT) because it uses the principle of realization to define and measure capital income. Overall, three major structural and accounting principles distinguish a RBIT from either the AMIT or CFIT capital income taxation paradigm. All of these principles have important capital income taxation policy implications. However, this article focuses on those principles in the context of short-lived completely wasting income-producing assets because their application is fairly clear in this context. In addition, an analysis of these assets allows this article to highlight and isolate the important issue of RBIT cost recovery policy.