IRS Tax Forms  
Publication 946 2001 Tax Year

Depreciation Worksheet

The worksheet shows the information needed to figure depreciation on each item of property and the total depreciation for 2001. The corporation's books and records support the information on the worksheet. There is an account for each item of property. These accounts show the following information.

  • The date of acquisition.
  • A description of the property.
  • The cost or other basis of the property.
  • The amount of section 179 deduction claimed.
  • The MACRS depreciation method used.
  • The property class and recovery period.
  • The depreciation deducted each year.

For information on business recordkeeping, see Publication 583, Starting a Business and Keeping Records.

On February 2, 1999, the corporation bought the building used as its place of business for $250,000 and placed it in service. It also bought and placed in service on that date the following property.

  • A desk and chair for $1,025.
  • Refrigeration equipment for $4,500.
  • Work tables for $1,200.
  • A cash register for $675.

The building is nonresidential real property. Fields of Flowers depreciates it using the straight line method and mid-month convention over a recovery period of 39 years. It uses Table A-7a.

The desk and chair are 7-year property. The corporation claimed a section 179 deduction for their full cost. It takes no depreciation for this property. The refrigeration equipment, work tables, and cash register are 5-year property. The corporation depreciates this property using the 200% declining balance method. Because no property was placed in service in the last quarter of the tax year, the half-year convention applies. The corporation uses Table A-1 to figure the depreciation for each item.

In 2000, Fields of Flowers bought and placed in service the following property.

  • On April 16, a delivery truck for $32,000.
  • On July 3, a typewriter for $300.

It claimed a $20,000 section 179 deduction for the truck. The basis of the truck for depreciation is $12,000 ($32,000 - $20,000). The basis of the typewriter for depreciation is its cost of $300. It chose to use the 150% declining balance method over the GDS recovery period for these property items. The recovery period for both the truck and typewriter is 5 years. It applied the half-year convention for both items and used Table A-14.

In 2001, Fields of Flowers bought and placed in service the following property.

  • On June 21, a computer for $3,000.
  • On September 9, file cabinets for $475.
  • On November 1, store counters for $1,870.
  • On November 16, a USA 280F van for $28,800.

The total bases of the counters and the van, placed in service during the last three months of the corporation's tax year, is $30,670. This is more than 40% of $34,145, the total bases of all property placed in service during 2001. The corporation does not elect to apply the half-year convention. It must apply the mid-quarter convention for all four items.

The corporation elects to claim a section 179 deduction of $24,000 for the van. The basis of the van for depreciation is $4,800 ($28,800 - $24,000).

The file cabinets are 7-year property for which the corporation uses Table A-4. The counters, the van, and the computer are 5-year property. The corporation elects to use ADS for its 5-year property. The ADS recovery period is 9 years for the counters and 5 years for the van and computer. The corporation uses Table A-10 for the computer and Table A-12 for the store counters and van.

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