A mid month convention applies to real property Under this convention property

A mid month convention applies to real property under

This preview shows page 2 - 3 out of 3 pages.

A mid-month convention applies to real property . Under this convention, property is considered placed in service in the middle of the month for the first month of service and the last month of service. A mid-quarter convention applies when more than 40% of the cost of all personal property is placed in service during the last quarter of the taxable year. Under the mid quarter convention, personal property is treated as placed in service in the middle of the quarter. Bonus Depreciation Taxpayers may elect to deduct “bonus depreciation” in an amount equal to 50% of the cost of new property purchased in 2013. This provision is likely to be extended through 2014. Bonus depreciation is claimed after the Section 179 deduction Regular, MACRS depreciation may be claimed on the remaining cost
Image of page 2
Bonus depreciation on automobiles is limited to $8,000 Depreciation Approach First apply IRC 179 Second, apply bonus depreciation Third depreciate as normal (MACRS) o Determine the asset class o Determine the applicable cost recovery method o Determine the applicable convention Amortization Amortizable property is intangible property that is used for business and is of limited life. For example, goodwill, going concern value, licenses, covenants not to compete, franchises, trademarks, patents, and copyrights. Straight Line of 15 years. IRC 197. No conventions. Count exactly the number of months intangible was in service.
Image of page 3

You've reached the end of your free preview.

Want to read all 3 pages?

  • Fall '14
  • fabioambrosio
  • Accounting, Business, Depreciation, Expense, Generally Accepted Accounting Principles

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes