Question

If a taxpayer has a new business with little income or a business with a net operating loss carryover, the taxpayer should elect to use straight-line depreciation.

A. True
B. False

Answer 1

If a taxpayer has a new business with little income or a business with a net operating loss carryover, it is generally more beneficial for the taxpayer to elect to use straight-line depreciation.

Step-by-step explanation:

If a taxpayer has a new business with little income or a business with a net operating loss carryover, it is generally more beneficial for the taxpayer to elect to use straight-line depreciation. This is because straight-line depreciation allows the taxpayer to deduct a consistent amount of depreciation expense each year, regardless of the business's income. This can help offset the losses and reduce the taxpayer's overall tax liability.