@Igotthis, thanks, the example is below: I am not sure how they are coming up with the calculation of 2/7 and 1/8???
Questoin: Furniture and Fixtures cost $112,000 and placed into service on December 1 for a calendar year tax payer. The purchases are the only depreciable property purchased during the year and did not make any special elections for Sec 179. Determine the MACRS deduction for the furniture and fixtures placed in service during 2012.
Answer: The furniture and fixtures qualify as 7-year property and under MACRS will be depreciated using the 200% declining balance method. Regular MACRS depreciation would be computed under which a half-year convention normally applies to the year of acquisition. However, the midquarter convention must be used if more than 40% of all personal property is placed in service during the last quarter of the taxpayer’s taxable year. Since this was Rockford’s only acquisition of personal property and the property was placed in service during the last quarter of Rockford’s calendar year, the midquarter convention must be used. Under this convention, property is treated as placed in service during the middle of the quarter in which placed in service. Since the furniture and fixtures were placed in service in December the amount of allowable MACRS depreciation is limited to ($112,000) x 2/7 x 1/8 = $4,000.
Florida:
AUD: 73, 81! Thank you Lord!
BEC: 73, 77! Thank you Lord! and WTB
REG: 71, 82! Thank you Lord! and A71
FAR: 72, 78! Thank you God and my Mommy in Heaven!
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