SB Depreciation

The Straight-Line Full Month Plus 168 depreciation method (method SB) calculates depreciation in the same manner as method SF, except that an additional 168 Allowance % is taken in the first year.

Note: 100% bonus is available for qualified assets placed in service:
- between 9/28/2017 and 12/31/2022
- on or after 1/20/2025

Note: The 168 Extra feature allows you to use a 168 Allowance % not valid for federal purposes for assets placed in service in years 2023 and later.

Here is an example where 30% 168 Allowance is taken:

Acquired Value:	$16,000
Recovery Period:	5 Years
Salvage Value:	$1,000
Placed-in-Service Date:	11/30/01

Year 1:

First, the salvage value is subtracted from the acquisition value:

$16,000 - 1,000 = 15,000

Next, the 168 Allowance is calculated:

15,000 X .30 = 4,500

Then, the 168 Allowance is subtracted from the $15,000 to calculate the depreciable basis:

$15,000 - 4,500 = $10,500

Next, the first-year depreciation is calculated:

$10,500

2 *

$350

* The full month averaging convention allows a full month of depreciation for November. Therefore, the asset receives 2 months of depreciation in the first year.

Year 2:

The following formula is used to calculate the annual depreciation for the second (and following years):

Depreciable Basis

Estimated Life

Annual Depr.

10,500

2,100

Year 3:

10,500

2,100

Year 4:

10,500

2,100

Year 5:

10,500

2,100

Year 6:

10,500

1750