Pyle Inc., a calendar year taxpayer, generated over $10 million taxable income in 2016. Pyle made one asset purchase: new transportation equipment costing $322,000. The equipment has a 5-year recovery period and was placed in service on February 9. Assuming that Pyle made the Section 179 election with respect to the equipment, compute Pyle's 2016 cost recovery deduction.
A) $193,200
B) $322,000
C) $64,400
D) $500,000

Question

Quizplus · Accepted Answer

Pyle can elect to expense the entire cost of the equipment ($322,000) under Section 179, as it is below the maximum deduction limit for 2016.

Pyle Inc, a Calendar Year Taxpayer, Generated Over $10 Million Taxable