Question

Required information [The following information applies to the questions displayed below.] Assume that TDW Corporation (calendar-year-end) has 2019 taxable income of $650,000 for purposes of computing the $179 expense. The company acquired the following assets during 2019: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Furniture Placed in Service September 12 February 10 April 2 Basis $2,270,000 263,000 880,000 $3,413,000 Total a. What is the maximum amount of $179 expense TDW may deduct for 2019? Maximum $179 expense deductible

***PLEASE EXPLAIN AND FILL IN BOXES, $87,000 ISWRONG FOR part a)

Answer 1

a)$137,000

b)$483,157.7

Workings:

a)

Particulars	Amount
a)Total Qualified property	34,13,000.00
b)Threshold limit for sec 179 phaseout	25,50,000.00
c)Phase out of max sec 179(a-b)	8,63,000.00
d)Maximum sec 179 expense before phase out	10,00,000.00
e)Max sec 179 expense after phase out(d-c)	1,37,000.00

b)

Particulars	Amount	Year	Sec 179	Remaining balance	Depreciation rate	Depreciation
Machinery	22,70,000.00	7	1,37,000.00	21,33,000.00	14.29%	3,04,805.70
Computer Euipment	2,63,000.00	5	-	2,63,000.00	20%	52,600.00
Furniture	8,80,000.00	7	-	8,80,000.00	14.29%	1,25,752.00
Total	34,13,000.00			32,76,000.00		4,83,157.70