Sally purchased new equipment for her consulting business.She allocates the Section 179 deduction among the new assets.One piece of equipment cost $500,000 and was allocated one-half of the allowable Section 179 deduction and therefore has a depreciable basis of $250,000.

Question

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This statement is true. The Section 179 deduction allows businesses to immediately deduct the cost of qualifying assets, up to a certain limit, instead of depreciating them over time. In this case, Sally allocated half of the allowable Section 179 deduction to the piece of equipment that cost $500,000, which means the depreciable basis for that asset is $250,000.

Sally Purchased New Equipment for Her Consulting Business