Heather purchased furniture and fixtures (7-year property) for her retail shop for $50,000. What is the AMT depreciation adjustment required in 2015 if the property was purchased in May 2015, assuming no bonus depreciation was taken?
A) $0.
B) $1,790.
C) $5,355.
D)$7,145.

Question

Quizplus · Accepted Answer

The AMT depreciation adjustment for 7-year property is calculated by multiplying the unadjusted basis by 1/7. In this case, the unadjusted basis is $50,000, so the AMT depreciation adjustment is $50,000 x 1/7 = $7,145. However, since the property was purchased in May 2015, only 8/12 of the full year's depreciation is allowed. Therefore, the AMT depreciation adjustment for 2015 is $7,145 x 8/12 = $4,763.

Heather Purchased Furniture and Fixtures (7-Year Property) for Her Retail