of $142,000 and deduction of $420,000, resulting in a loss of $278,000. The large deduction are due to the acquisition of equipment and the use of immediate expense and additional first-year depreciation to deductio

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization
Section: Chapter Questions
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During 2020, Leisel, a single taxpayer, operates a sole proprietorship in which she materially participates. Her proprietorship generates gross income of $142,000 and deduction of $420,000, resulting in a loss of $278,000. The large deduction are due to the acquisition of equipment and the use of immediate expense and additional first-year depreciation to deduction all of the acquisition. Can Leisel use all of this loss to offset other income she has? Explain
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