the basis of an asset on which 20,000 has been expensed under 179 course hero

What is the maximum cost recovery method for all personal property under MACRS?

The maximum of cost recovery method for all personal property under MACRS is 150% declining balance.

How long is the True portion of expenses amortized?

True- portion of expenses (2,000) can be deducted immediately ($5,000 max less startup expenses excess of $50,000). The balance is amortized over 180 months.

What is the cost recovery deduction for first year?

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

What is the key date for calculating cost recovery?

The key date for calculating cost recovery is the date the asset is placed in service.

What is the cost recovery basis for property converted from personal use to business use?

The cost recovery basis for property converted from personal use to business use may be the fair market value of the property at the time of the conversion.

How long is covenant not to complete amortized?

The cost of covenant NOT to complete for 10 years incurred in connection with the acquisition of a business is amortized over 10 years.

What is the substantiation requirement for all listed properties?

All listed property is subject to the substantiation requirements of 274.

What chapter is depreciation, cost recovery, amortization, and depletion?

Start studying Chapter 8 Depreciation, Cost Recovery, Amortization, and Depletion - TAX. Learn vocabulary, terms, and more with flashcards, games, and other study tools.

How much can you deduct from a 179?

The § 179 deduction can exceed $1,000,000 in 2018 if the taxpayer had a § 179 amount which exceeded the taxable income limitation in the prior year.

What is MACRS depreciation?

MACRS depreciation is a deduction in computing taxable income for purposes of the § 179 limitations.

How much is the cost recovery deduction?

The total cost recovery deduction for the first year would be $7,000 ($35,000 x 20%) which is less than $10,000 (§ 280F limit). The cost recovery in the first year using straight-line would be $3,500 ($35,000 x 10%) which is less than $10,000 (§ 280F limit) . As a result, there is cost recovery recapture of $3,500.

What happens if a used car fails the 50% business usage test?

If the automobile fails the 50% business usage test in the second year, no cost recovery will be recaptured.(T/F)

How long is a second quarter property in service?

If more than 40% of the value of property, other than real property, is placed in service during the last quarter, all of the property placed in service in the second quarter will be allowed 7.5 months of cost recovery.

What is the key date for calculating cost recovery?

The key date for calculating cost recovery is the date the asset is placed in service.