Final answer:
The statement is false as cost recovery usually begins on the date the asset is placed in service, not the purchase date. Cost recovery is crucial for depreciation and accurate tax calculations.
Step-by-step explanation:
The statement that the key date for calculating cost recovery is the date the asset is purchased is false. Cost recovery, specifically in the context of depreciation for tax purposes, commonly starts on the date the asset is placed in service, not necessarily the purchase date. This is the date when an asset is ready and available for a specific use, whether in a business activity, an income-producing activity, or a personal activity. There could be a gap between the purchase date and the in-service date if, for example, the asset requires installation or setup before it's operational. Therefore, it's important to distinguish between these dates for accurate tax calculations.