Straight-Line, Alternate ACRS Short-Year Calculation

For an alternate straight-line short-year calculation, the amount of depreciation computed for a full year is prorated over the number of months in the short-year period. The system prorates the amount of depreciation computed for a full year by multiplying the amount by the short-year fraction.

For personal property, the half-year rule applies; that is, one-half of the depreciation calculated for the short-year period is taken. In the disposal year, no depreciation is allowed regardless of whether the disposal year is a full tax year or a short tax year. The unrecovered allowance is the difference between the recovery allowance permitted for the short taxable year and the recovery allowance that would have been allowed if the year were not a short taxable year. It is claimed in the tax year following the recovery period.