Sairra LLC purchased only one asset during the current year (a full 12-month tax year). On April 16 Sairra placed in service furniture (seven-year property) with a basis of $30,000. Calculate the maximum depreciation expense for the current year (ignoring §179 and bonus depreciation).

Question

Quizplus · Accepted Answer

The maximum depreciation expense is calculated using the MACRS half-year convention for seven-year property. The first-year depreciation rate for seven-year property is 14.29%. Therefore, $30,000 x 14.29% = $4,287.

Sairra LLC Purchased Only One Asset During the Current Year