Carolyn purchases a new delivery truck 5-year MACRS property) costing $30,000 for use in her floral business on January 5, 2014. If Carolyn's taxable income from the floral business before any special elections is $8,000 for 2014, what is her maximum allowable cost recovery on the delivery truck in 2014?

Question

Quizplus · Accepted Answer

The maximum allowable cost recovery for the delivery truck in 2014 is $12,400. This includes the MACRS depreciation for 5-year property, which is 20% of $30,000, equaling $6,000, plus the Section 179 deduction limited to her taxable income of $8,000, totaling $12,400.

Carolyn Purchases a New Delivery Truck 5-Year MACRS Property) Costing