le proprietor who has a small business currently operating at a loss. He would like to discontinue depreciating the fixed assets of th d. What tax consequences would result if Rick implements the plan to discontinue depreciation and then sells some of the deprecia ne basis of the property must be reduced on a consistent basis by depreciation computed using one of several accounting methods pr owable is defined as the slowest possible method allowed by law. Rick could wind up recognizing a gain to the extent the asset is solc epreciation deductions are not discretionary. The basis of property must be reduced by the amount of depreciation that should have be aimed. Rick could wind up recognizing a gain to the extent the asset is sold for more than its adjusted basis. epreciation deductions are discretionary. Therefore, the basis of property would be higher by the amount of depreciation that is carried n the sale. Both a and b are correct