Zachary purchased a Ford Expedition (more than 6,000 lb) for $39,000 in March 2023. What is the maximum depreciation expense allowed, assuming that Zachary is eligible for the I R C §179 expense election and no bonus is elected? a. $7,800. b. $28,900. c. $30,920. d. $39,000.
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- James purchased office equipment for his business. The equipment has a depreciable basis of $7,000 and was put in service on June 1,2019. James decides to elect straightline depreciation under MACRS for the asset over the minimum number of years (7 years), and does not use bonus depreciation or make the election to expense. What is the amount of his depreciation deduction for the equipment for the 2019 tax year? $2,000 $1,000 $500 $0 None of the aboveLO.2, 3, 9 On June 5, 2018, Javier Sanchez purchased and placed in service a new 7-year class asset costing 560,000 for use in his landscaping business, which he operates as a single member LLC (Sanchez Landscaping LLC). During 2018, his business generated a net income of 945,780 before any 179 immediate expense election. a. Rather than using bonus depreciation, Javier would like to use 179 to expense 200,000 of this asset and then use regular MACRS to cost recover the remaining cost. Given this information, determine the cost recovery deductions that Javier can claim with respect to this asset in 2018 and 2019. b. Complete Javiers Form 4562 (page 1) for 2018. His Social Security number is 123-45-6789.In March 2019, Helen Carlon acquired used equipment for her business at a cost of 300,000. The equipment is five-year property for regular tax depreciation purposes. a. If Helen depreciates the equipment using the method that will produce the greatest deduction for 2019 for regular income tax purposes, what is the amount of the AMT adjustment? b. Draft a letter to Helen regarding the choice of depreciation methods. Helens address is 500 Monticello Avenue, Glendale, AZ 85306.
- Michael Sima, a sole proprietor craftsman, purchased an amount of equipment in the current year that exceeded the maximum allowable 179 depreciation election limit by 20,000. Simas total purchases of property placed in service in the current year did not exceed the limit imposed by 179. All of the property (including the equipment) was purchased in November of the current year, and Sima elected to depreciate the maximum amount of equipment under 179. Sima had bottom-line Schedule C income of 50,000 in the current year. Which method may Sima use to depreciate the remaining equipment in the current year? a. Sima may not depreciate any additional equipment other than the 179 maximum in the current year and must carry forward the excess amount to use in the following taxable year. b. MACRS half-year convention for personal property. c. MACRS mid-quarter convention for personal property. d. Straight-line, mid-month convention over 27.5 years for real property.In 2019, Mary sells for $24,000 a machine used in her business. The machine was purchased on May 1,2017, at a cost of $22,000. Mary has deducted depreciation on the machine of $6,000. What is the amount and nature of Mary's gain as a result of the sale of the machine? $2,000 Section 1231 gain $8,000 ordinary income under Section 1245 $6,000 ordinary income and $2,000 Section 1231 gain $6,000 Section 1231 gain and $2,000 ordinary income under Section 1245 None of the aboveAlice purchases a rental house on August 22,2019, for a cost of $174,000. Of this amount, $100,000 is considered to be allocable to the cost of the home, with the remaining $74,000 allocable to the cost of the land. What is Alice's maximum depreciation deduction for 2019 using MACRS? $2,373 $1,970 $1,364 $1,061 $1,009