Ilene owns an unincorporated manufacturing business.In 2019,she purchases and places in service $2,650,000 of qualifying five-year equipment for use in her business.Her taxable income from the business before any depreciation deduction is $900,000.Ilene will elect out of bonus depreciation but plans to take the maximum allowable deduction under Sec.179.Which of the following statements is true regarding the Sec.179 election?

Question

Quizplus · Accepted Answer

Ilene can deduct up to $1,020,000 under Sec.179, but since her taxable income is only $900,000, the maximum allowable deduction is reduced to $900,000. Therefore, she can deduct $900,000 as a Sec.179 deduction in 2019, and the remaining $20,000 can be carried over to the next year.

Ilene Owns an Unincorporated Manufacturing Business