If a machine (seven-year property) being depreciated using the half-year convention is disposed of during the seventh year, a taxpayer must multiply the appropriate depreciation percentage from the MACRS table percentage by 50 percent to calculate the depreciation expense properly.

Question

Quizplus · Accepted Answer

The statement is true. When a machine is disposed of during the seventh year and is being depreciated using the half-year convention, the taxpayer is required to multiply the appropriate depreciation percentage from the MACRS table percentage by 50 percent to calculate the depreciation expense properly. This is because in the seventh year, only half of the full-year depreciation is allowed to be taken per the half-year convention.

If a Machine (Seven-Year Property) Being Depreciated Using the Half-Year