Depreciation on property in the five-year MACRS class is claimed over a period of six tax years due to the half-year convention.

Question

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The half-year convention requires that regardless of when the property is placed in service during the year, it is treated as if it were placed in service at the midpoint of the year. Therefore, for property in the 5-year MACRS class, depreciation is claimed over 6 tax years instead of 5.

Depreciation on Property in the Five-Year MACRS Class Is Claimed