If a used $35,000 automobile used 100% for business in the first year (2014)fails the 50% business usage test in the second year,no cost recovery will be recaptured.

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Quizplus · Accepted Answer

The total cost recovery deduction for the first year would be $3,160 (§ 280F limit)which is less than $7,000 ($35,000 × 20%).The cost recovery in the first year using straight­line would be $3,160 (§ 280F limit)which is less than $3,500 ($35,000 × 10%).Therefore,there is no cost recovery recapture.

If a Used $35,000 Automobile Used 100% for Business in the First