Question

Which depreciation convention is the general rule for tangible personal property?

A. Full-month
B. Half-year
C. Mid-month
D. Mid-quarter
E. None of these are conventions for tangible personal property

Answer 1

The general rule for tangible personal property depreciation is the Half-year convention. Under this convention, half of the depreciation expense is taken in the first year regardless of when the property was acquired or placed in service. In subsequent years, the regular depreciation expense can be taken.

Step-by-step explanation:

The general rule for tangible personal property depreciation is the Half-year convention.

Under this convention, half of the depreciation expense is taken in the first year regardless of when the property was acquired or placed in service. In subsequent years, the regular depreciation expense can be taken.

For example, if you purchase a computer for $2,000 and use it for business purposes, you can depreciate $1,000 in the first year and the remaining $1,000 over the useful life of the computer.