Loni Company paid $1,057,000 for tangible personalty in 2020 and elected to expense $1,040,000 of the cost (the limited dollar amount for 2020). Loni’s taxable income before a Section 179 deduction was $894,100. Loni paid $23,700 for tangible personalty in 2021 and elected to expense the entire cost. Loni’s taxable income before a Section 179 deduction was $228,000. 

Required:

1. Compute Loni’s Section 179 deduction and taxable income for 2020.
2. Compute Loni’s Section 179 deduction and taxable income for 2021.

Answer rating: 100% (QA)

As per the IRS the Section 179 deduction cant be more than the t... View the full answer