Kyle drives a race car in his spare time and on weekends.His records regarding this activity reflect the following information for the year. What is the allowable deduction (before any AGI limitation)for depreciation assuming that this activity is not engaged in for profit and Kyle can itemize his deductions?

Question

Kyle drives a race car in his spare time and on weekends.His records regarding this activity reflect the following information for the year.  What is the allowable deduction (before any AGI limitation)for depreciation assuming that this activity is not engaged in for profit and Kyle can itemize his deductions?

Quizplus · Accepted Answer

Since Kyle's race car activity is not engaged in for profit, he cannot take any deductions for depreciation. Therefore, the allowable deduction is $0. Option A is incorrect. Option B is incorrect because Kyle cannot deduct any amount for depreciation. Option D is incorrect because Kyle cannot deduct any amount for depreciation.

Kyle Drives a Race Car in His Spare Time and on Weekends.His