Lori, who is single, purchased 5-year class property for $31,000 and 7-year class property for $42,000 on May 20, 2014. Lori expects the taxable income derived from her business (without regard to the amount expensed under § 179) to be about $100,000. Lori wants to elect immediate § 179 expensing, but she doesn't know which asset she should expense under § 179. Lori does not claim any available additional first-year depreciation.
a. Determine Lori's total deduction if the § 179 expense is first taken with respect to the 5-year class asset.
b. Determine Lori's total deduction if the § 179 expense is first taken with respect to the 7-year class asset.
c. What is your advice to Lori?