In July of 2015,Pat acquired a new automobile for $28,000 and used the automobile 80% for business.No election is made regarding Sec.179.Assuming her business use remains at 80%,Pat can take a maximum depreciation deduction in 2015 of
A)$2,528.
B)$3,160.
C)$5,600.
D)$4,480.

Question

Quizplus · Accepted Answer

The maximum depreciation deduction for the first year is $5,600 (28,000 x 20%). Since no election is made regarding Sec.179, the deduction is taken over the 5-year recovery period. The deduction for 2015 is 20% of $5,600, or $1,120. Since the automobile was used 80% for business, the maximum depreciation deduction for 2015 is $1,120 x 80%, or $896.

In July of 2015,Pat Acquired a New Automobile for $28,000