MACRS - Half-year convention
Per Pub 946, MACRS assets are subject to the half-year (HY) convention if the mid-quarter and mid-month conventions don't apply. All property placed in service or disposed of during the tax year is then treated as placed in service or disposed of at the midpoint of the tax year, meaning a half-year of depreciation is allowed.
If using this convention, enter
HY
under column (e) in Part III of Form 4562.note
- For a personal property MACRS asset, one-half year depreciation is allowed in the year of acquisition or disposition when the asset is subject to the HY convention.
- For a real property MACRS asset subject to the HY convention, one-half month depreciation for the month of acquisition or disposition plus depreciation for preceding months in the same tax year is allowed.
