33. Compute MACRS depreciation for the following qualified assets for the calendar mo years 2022 and 2023: (Ignore bonus oq depreciation and the Section 179 deduction.) Asset Year Cost Purchased March 2022 Business equipment (7-year 5101 191. CE stia Building (Office) bar property) omiad sds abCar O May 2022 Office furniture OVE July 2022 204no (7-year gab aur property) h6D) ECOS ob Salvage Value $85,500 $10,000 14,000 18,050 1,000 3,000 January 2022 185,000 5,000

33. Compute MACRS depreciation for the following qualified assets for the calendar mo years 2022 and 2023: (Ignore bonus oq depreciation and the Section 179 deduction.) Asset Year Cost Purchased March 2022 Business equipment (7-year 5101 191. CE stia Building (Office) bar property) omiad sds abCar O May 2022 Office furniture OVE July 2022 204no (7-year gab aur property) h6D) ECOS ob Salvage Value $85,500 $10,000 14,000 18,050 1,000 3,000 January 2022 185,000 5,000

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter8: Depreciation And Sale Of Business Property

Section: Chapter Questions

Problem 5MCQ: Which of the following statements with respect to the depreciation of property under MACRS is...

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LO.4, 7 In December 2019, Carl Corporation sold land it held as an investment. The corporation received 50,000 in 2019 and a note payable (with adequate interest) for 150,000 to be paid in 2021. Carl Corporations cost of the land was 80,000. The corporation has a 90,000 net capital loss carryover that will expire in 2019. Should Carl Corporation report the sale in 2019 or use the installment method to report the income as payments are received?
Which of the following statements with respect to the depreciation of property under MACRS is incorrect? Under the half-year convention, one-half year of depreciation is allowed in the year the property is placed in service. If a taxpayer elects to use the straight-line method of depreciation for property in the 5 -year class, all other 5 -year class property acquired during the year must also be depreciated using the straight-line method. In some cases, when a taxpayer places a significant amount of property in service during the last quarter of the year, real property must be depreciated using a mid-quarter convention. Real property acquired after 1986 must be depreciated using the straight-line method. The cost of property to which the MACRS rate is applied is not reduced for estimated salvage value.
LO.3 Green Corporation, a calendar year taxpayer, has ordinary income of 10,000 and a long-term capital loss of 12,000 in 2019. Green incurred a long-term capital gain of 2,500 in 2016 and a long-term capital gain of 5,000 in 2018. a. How much of the long-term capital loss can be deducted in 2019? b. Carried back to prior years? c. Carried forward to future years? d. What is the nature (long- or short-term) of any carrybacks or carryforwards?
LO.7 On October 1, 2019, Priscilla purchased a business. Of the purchase price, 60,000 is allocated to a patent and 375,000 is allocated to goodwill. Calculate Priscillas 2019 197 amortization deduction.