Back in Boston, Steve has been busy creating and managing his new company, Teton Mountaineering (TM), which is based out of a small town in Wyoming. In the process of doing so, TM has acquired various types of assets. Below is a list of assets acquired during 2016:

 

*Not considered a luxury automobile, thus not subject to the luxury automobile limitations

During 2016, TM had huge success (and had no §179 limitations) and Steve acquired more assets the next year to increase its production capacity. These are the assets acquired during 2017:

^€ Used 100% for business purposes. 

TM generated taxable income in 2017 of $732,500 for purposes of computing the §179 expense.

Required

• Compute themaximum 2016depreciation deductions including §179 expense (ignoring bonus depreciation).
• Compute the maximum 2017depreciation deductions including §179 expense (ignoring bonus depreciation).
• Compute the maximum 2017depreciation deductions including §179 expense, but now assume that Steve would like to take bonus depreciation.

Ignoring part c, now assume that during 2017, Steve decides to buy a competitor€™s assets for a purchase price of $350,000. Compute the maximum 2017cost recovery including §179 expense (ignoring bonus depreciation). Steve purchased the following assets for the lump-sum purchase price

• Complete Part I of Form 4562 for part b (use the most current form available).

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Date Place in Service Asset Cost 02/03/2016 Office furniture $10,000 07/22/2016 Machinery 560,000 Used delivery truck* 08/17/2016 15,000 Asset Date Place in Service Cost Computers & Info. System $40,000 03/31/2017 Luxury Auto* 05/26/2017 80,000 Assembly Equipment 475,000 08/15/2017 Storage Building 400,000 11/13/2017