Quattro Enterprises,a calender year taxpayer,leases the twentieth floor of a building downtown.Due to employment expansion,it renovated the entire office space layout,spending $600,000 on these leasehold improvements.The office renovation was completed in May.Quattro also spent $500,000 on new computer systems and office furniture and fixtures in May on which the business used its entire Sec.179 allowance for 2016.What is the maximum depreciation deduction available in 2016 for the leasehold improvements?
A)$9,630
B)$40,000
C)$310,000
D)$20,000

Question

Quizplus · Accepted Answer

The maximum depreciation deduction available in 2016 for the leasehold improvements is $310,000. This is because the leasehold improvements are depreciated over 15 years, and the taxpayer has used its entire Sec. 179 allowance for 2016 on other assets.

Quattro Enterprises,a Calender Year Taxpayer,leases the Twentieth Floor of a Building