[Mars2010]

It is used if more than 40% of property are added in last quarter.

Lets say 45% added in last quarter, and 55% are added in first quarter.

So 100% will be depreciated using mid quarter of last quarter?

Or it 45% will be depreciated using mid quarter of last quarter, and 55% using mid quarter of first quarter? (each in the quarter it is added in).

Thanks

[Anonymous]

If more than 40% are placed into service in the last quarter (typically Oct-Dec), you will use mid-quarter convention for the WHOLE year. So if you get a SIM on depreciation, the other tab will usually have MACRS tables for all quarters of the year so you can calculate all the depreciation correctly.

[Anonymous]

If more than 40% are placed into service in the last quarter (typically Oct-Dec), you will use mid-quarter convention for the WHOLE year. So if you get a SIM on depreciation, the other tab will usually have MACRS tables for all quarters of the year so you can calculate all the depreciation correctly.

[igelfand]

According to the IRS website:

“Under this convention, you treat all property placed in service or disposed of during any quarter of the tax year as placed in service or disposed of at the midpoint of that quarter. This means that 1½ months of depreciation is allowed for the quarter the property is placed in service or disposed of.”

https://www.irs.gov/publications/p946/ch04.html#en_US_2012_publink1000107538

[igelfand]

According to the IRS website:

“Under this convention, you treat all property placed in service or disposed of during any quarter of the tax year as placed in service or disposed of at the midpoint of that quarter. This means that 1½ months of depreciation is allowed for the quarter the property is placed in service or disposed of.”

https://www.irs.gov/publications/p946/ch04.html#en_US_2012_publink1000107538

[Determined CPA]

Mid-quarter is used if more than 40% of assets are placed in service in the last quarter. However, Section 179 gets rid of this mid-quarter convention.

example: 10,000 placed in service jan-aug, 7,000 placed in service December – midquarter; however, if you section 179 the 7,000, it is removed and you are do not use mid-quarter.

A - 75
B - 78 God is good.
F - 77 Answered prayers.
R - 84! Done!!

Paperwork sent - waiting for license!!
Still on a cloud and in shock. Through God, all things will happen.

[Determined CPA]

Mid-quarter is used if more than 40% of assets are placed in service in the last quarter. However, Section 179 gets rid of this mid-quarter convention.

example: 10,000 placed in service jan-aug, 7,000 placed in service December – midquarter; however, if you section 179 the 7,000, it is removed and you are do not use mid-quarter.

A - 75
B - 78 God is good.
F - 77 Answered prayers.
R - 84! Done!!

Paperwork sent - waiting for license!!
Still on a cloud and in shock. Through God, all things will happen.

[Mars2010]

Thanks guys.

So it will be: “45% will be depreciated using mid quarter of last quarter, and 55% using mid quarter of first quarter? (each in the quarter it is added in)”

[Mars2010]

Thanks guys.

So it will be: “45% will be depreciated using mid quarter of last quarter, and 55% using mid quarter of first quarter? (each in the quarter it is added in)”

[Whopper Warrior]

yes. there are 4 quarters. assets would be placed and depreciated in each respective quarter. in your example 55% first quarter, and 45% fourth quarter. you should have tables if not macrs is double decling balance.

normally we use mid year or half year convention. for example 5 yr property:

200% / 5 years * 1/2 year equals 20% which is in the macrs table.

for mid quarter it would be 200% / 5 years x 3.5 / 4 equlas 35%, again which is in macrs. this calculation is for the 55% of assets placed in service first quarter.

the convention is based on double declining balance, but in year of sale/disposal it is considered to be used only half a year. midquarter breaks it down further because the IRS does not want you loading up on assets on december 31st, to take a half year of depreciation. instead they force .5 /4 or 1/2 of 1 quarter out of 4 quarters. (45% of assets last quarter)

ALL 4 parts passed summer 13
Ethics October 13
Experience (waiting)

Becker Only

[Whopper Warrior]

yes. there are 4 quarters. assets would be placed and depreciated in each respective quarter. in your example 55% first quarter, and 45% fourth quarter. you should have tables if not macrs is double decling balance.

normally we use mid year or half year convention. for example 5 yr property:

200% / 5 years * 1/2 year equals 20% which is in the macrs table.

for mid quarter it would be 200% / 5 years x 3.5 / 4 equlas 35%, again which is in macrs. this calculation is for the 55% of assets placed in service first quarter.

the convention is based on double declining balance, but in year of sale/disposal it is considered to be used only half a year. midquarter breaks it down further because the IRS does not want you loading up on assets on december 31st, to take a half year of depreciation. instead they force .5 /4 or 1/2 of 1 quarter out of 4 quarters. (45% of assets last quarter)

ALL 4 parts passed summer 13
Ethics October 13
Experience (waiting)

Becker Only

[LedellLiza55]

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[LedellLiza55]

Your idea is outstanding the issue is one thing that not enough persons are speaking intelligently about. I am very completely satisfied that.

[Author]

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