W&F Company, a calendar year taxpayer, purchased a total of $2,694,700 tangible personalty in 2020. How much of this cost can W&F elect to expense under Section 179?
A) -0-
B) $104,700
C) $935,300
D) $1,040,000

Question

Quizplus · Accepted Answer

In 2020, the maximum Section 179 expense deduction is $1,040,000, but it is reduced dollar-for-dollar by the amount of property placed in service during the year that exceeds $2,590,000. Since W&F purchased $2,694,700, the deduction is reduced by $104,700 ($2,694,700 - $2,590,000), resulting in a maximum deduction of $935,300 ($1,040,000 - $104,700).

W&F Company, a Calendar Year Taxpayer, Purchased a Total of $2,694,700