Is There Depreciation Expense for an Asset if it was Disposed on Jan 1st of same year?

[mgmorris]

I disposed of an asset on Jan 1st.  TURBOTAX is still calculating a depreciation expense for the first half of the year.  Is that correct?

[DianeW777]

Yes.  If the asset was placed in service earlier than 2022 and now is disposed of.  Based on your question the asset was set up under the half-year (HY) convention which means there is a half year depreciation in the first year and the year removed from service if the asset is removed from service before the end of it's recovery period.  If this asset was sold then you would indicate that and enter your sale information.  

If this asset was disposed of because it was no longer useful or it was broken you can deduct the remainder of the cost left as an expense on your business schedule.

If it was converted to personal use, then you must track the depreciation used until it is sold.  If you happen to use any Section 179 and it was converted to personal use then you would be required to recapture the section 179 in 2022.

• IRS Publication 946