The only asset Bill purchased during 2015 was a new seven-year class asset.The asset,which was listed property,was acquired on June 17 at a cost of $50,000.The asset was used 40% for business,30% for the production of income,and the rest of the time for personal use.Bill always elects to expense the maximum amount under § 179 whenever it is applicable.The net income from the business before the § 179 deduction is $100,000.Determine Bill's maximum deduction with respect to the property for 2015.
A)$1,428
B)$2,499
C)$26,749
D)$33,375
E)None of the above

Question

Quizplus · Accepted Answer

The asset is used 70% for business and income production (40% + 30%), which qualifies it for depreciation. The maximum § 179 deduction is limited to the business use percentage. The depreciation is calculated using the MACRS method for listed property. The maximum deduction is $2,499.

The Only Asset Bill Purchased During 2015 Was a New