Jason is a single taxpayer who operates a business. In January, 2019 he purchased and placed into service $200,000 of 5-year class property and $300,000 of 7-year
class property. Provide your recommendation for the best cost recovery strategy in each of the following situations. Be sure to explain your reasoning and support it as required. Compute and show the total of the 5179 and cost recovery deduction that Jason will have for 2019.

1. Jason has income from his business before depreciation of $750,000.
2. Jason has income from his business before depreciation of $50,000, but he expects to earn income of $650,000 next year.
3. Jason has income from his business before depreciation of $30,000, and he expects similar amounts of income for the foreseeable future.

Answer rating: 100% (QA)

1 Jason has income from his business before depreciation of 750000 The best cost recovery strategy for Jason in this case would be to claim the entire ... View the full answer