On January 1, 2016, Sandy, a sole proprietor, purchased for use in her business a used production machine (7-year property) at a cost of $4,000. Sandy does not purchase any other property during 2016 and has net income from her business of $80,000. If the standard recovery period table would allow $572 of depreciation expense on the $4,000 of equipment purchased in 2016, what is Sandy's maximum depreciation deduction including the Section 179 election to expense (but not bonus depreciation) for 2016?

Question

Quizplus · Accepted Answer

Sandy can elect to expense the entire cost of the machine under Section 179, up to the purchase price of $4,000, since her net income is sufficient to cover it.

On January 1, 2016, Sandy, a Sole Proprietor, Purchased for Use