Lorenzo owns two apartment buildings. He acquired Forsythia Acres on February 21, 1998, for $300,000 ($90,000 allocated

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Lorenzo owns two apartment buildings. He acquired Forsythia Acres on February 21, 1998, for $300,000 ($90,000 allocated to the land) and Square One on November 12, 2015, for $800,000 ($100,000 allocated to the land). Neither apartment complex qualifies as low-income housing. If Lorenzo elects to write off the cost of each building as quickly as possible, what is the effect of depreciation (cost recovery) on his AMTI for:

a. 1998?

b. 2015?

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South Western Federal Taxation 2016 Comprehensive

ISBN: 9781305395114

39th Edition

Authors: James H. Boyd, William H. Jr. Hoffman, David M. Maloney, William A. Raabe, James C. Young

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