William purchases nonresidential real property costing $300,000 and places it in service in March 2015.What is Lincoln's 2016 depreciation on the property?

Question

Quizplus · Accepted Answer

Nonresidential real property has a recovery period of 39 years and the depreciation is calculated using the straight-line method. Therefore, the annual depreciation would be $300,000/39 = $7,692. Since the property was placed in service in March 2015, the first year of depreciation would be for a partial year, so Lincoln's 2016 depreciation would be $7,692.

William Purchases Nonresidential Real Property Costing $300,000 and Places It