While completing undergraduate school work in information systems, Dallin Bourne and Michael Banks decided to start a technology support company called eSys Answers. During year 1, they bought the following assets and incurred the following start-up fees: Year 1 Assets Computers (5-year) Office equipment (7-year) Furniture (7-year) Start-up costs Purchase Date October 30, Year 1 October 30, Year 1 October 30, Year 1 October 30, Year 1 Basis $16,200 10,000 5,400 19,160 In April of year 2, they decided to purchase a customer list from a company providing virtually the same services, started by fellow information systems students preparing to graduate. The customer list cost $12,160, and the sale was completed on April 30. During their summer break, Dallin and Michael passed on internship opportunities in an attempt to really grow their business into something they could do full time after graduation. In the summer, they purchased a small van (for transportation, not considered a luxury auto) and a pinball machine (to help attract new employees). They bought the van on June 15, Year 2, for $27,000 and spent $4,200 getting it ready to put into service. The pinball machine cost $5,200 and was placed in service on July 1, Year 2. Van Year 2 Assets Pinball machine (7-year) Customer list Purchase Date June 15, Year 2 July 1, Year 2 April 30, Year 2 Basis $ 31,200 5,200 12,160 Assume that eSys Answers does not claim any 179 expense or bonus depreciation. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Round your intermediate calculations and final answers to the nearest whole dollar amount.) . Complete eSys Answers's Form 4562 for Y1. Input all values as positive numbers. Use 2021 tax rules regardless of year on tax form. Assets acquired during Year 1 has to be entered under Section B part of Form 4562, page 1. Do not skip rows when entering Amortization of cost under line item 42 of Form 4562.) Form 4562 PG Form 4562 PG 1 2 Form 4562 Page 1 and 2. Form 4562 Depreciation and Amortization OMR No. 1545-0172 G < Prev 2 of 2 Next > Page 2 (2020) Part V Listed Property Note: (Include automobiles, certain other vehicles, certain aircraft, and property used for entertainment, recreation, or amusement.) For any vehicle for which you are using the standard mileage rate or deducting lease expense, complete only 24a, 24b, columns (a) through (c) of Section A, all of Section B, and Section C if applicable. Section A-Depreciation and Other Information 24a Do you have evidence to support the business/investment use claimed? (a) Type of property (list vehicles (Caution: See the instructions for limits for passenger automobiles.) Yes No 24b If "Yes," is the evidence written? Yes No (b) Date placed in service Business / investment (d) Cost or other basis (e) Basis for depreciation (business/investment use only) (f) Recovery period (g) Method/Convention deduction (h) Depreciation (i) Elected section 179 cost (c) first) use (mm/dd/yyyy) percentage 25 Special depreciation allowance for qualified listed property placed in service during the tax year and used more than 50% in a qualified business use. see instructions. 26 Property used more than 50% in a qualified business use: 27 Property used 50% or less in a qualified business use: 25 S/L- S/L- S/L- 28 Add amounts in column (h), lines 25 through 27. Enter here and on line 21, page 1 29 Add amounts in column (i), line 26. Enter here and on line 7, page 1 28 0 29 0 Section B-Information on Use of Vehicles Complete this section for vehicles used by a sole proprietor, partner, or other "more than 5% owner," or related person. If you provided vehicles to your employees, first answer the questions in Section C to see if you meet an exception to completing this section for those vehicles. (a) Vehicle 1 (b) Vehicle 2 (c) Vehicle 3 (d) Vehicle 4 (e) Vehicle 5 (f) Vehicle 6 Required information 30 Total business/investment miles driven during the year (don't include commuting miles) 31 Total commuting miles driven during the year 32 Total other personal (noncommuting) miles driven 33 Total miles driven during the year. Add lines 30 through 32 34 Was the vehicle available for personal use during off-duty hours? 35 Was the vehicle used primarily by a more than 5% owner or related person? 36 Is another vehicle available for personal use? (a) Vehicle 1 (b) Vehicle 2 (c) Vehicle 3 (d) Vehicle 4 (e) Vehicle 5 (f) Vehicle 6 0 0 0 0 0 0 Yes No Yes No Yes No Yes No Yes No Yes No Section C-Questions for Employers Who Provide Vehicles for Use by Their Employees Answer these questions to determine if you meet an exception to completing Section B for vehicles used by employees who aren't more than 5% owners or related persons. see instructions. 37 Do you maintain a written policy statement that prohibits all personal use of vehicles, including commuting, by your employees? Yes No 38 Do you maintain a written policy statement that prohibits personal use of vehicles, except commuting, by your employees? See the instructions for vehicles used by corporate officers, directors, or 1% or more owners. 39 Do you treat all use of vehicles by employees as personal use? 40 Do you provide more than five vehicles to your employees, obtain information from your employees about the use of the vehicles, and retain the information received? 41 Do you meet the requirements concerning qualified automobile demonstration use? See instructions. Note: If your answer to 37, 38, 39, 40, or 41 is "Yes," don't complete Section B for the covered vehicles. Part VI Amortization (a) Description of costs (b) Date amortization begins (c) Amortizable amount (d) Code section 42 Amortization of costs that begins during your 2020 tax year (see instructions): 43 Amortization of costs that began before your 2020 tax year. 44 Total. Add amounts in column (f). See the instructions for where to report. UYA (e) Amortization period or percentage (f) Amortization for this year 43 44 0 Form 4562 (2020)