Assume that Timberline Corporation has 2021 taxable income of $240,000 for purposes of computing the 179 expense.
Question:
Assume that Timberline Corporation has 2021 taxable income of $240,000 for purposes of computing the §179 expense. It acquired the following assets in 2021: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.)
Asset | Purchase Date | Basis |
---|---|---|
Furniture (7-year) | December 1 | $ 444,000 |
Computer equipment (5-year) | February 28 | 92,000 |
Copier (5-year) | July 15 | 32,000 |
Machinery (7-year) | May 22 | 482,000 |
Total | $ 1,050,000 |
Required:
a-1. What is the maximum amount of §179 expense Timberline may deduct for 2021?
a-2. What is Timberline’s §179 carryforward to 2022, if any?
b. What would Timberline’s maximum depreciation deduction be for 2021 assuming no bonus depreciation?
c. What would Timberline’s maximum depreciation deduction be for 2021 if the machinery cost $3,500,000 instead of $480,000 and assuming no bonus depreciation?
Essentials of Federal Taxation 2019
ISBN: 9781260190045
10th edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver