Homework Answers
| An apartment building is residential real estate, thus the depreciation rate that will apply for | ||
| apartment building purchased in March is 2.879%. | ||
| Cost of apartment building | $900,000 | |
| Depreciation rate for first year | 2.88% | |
| Maximum recovery deduction in 2018 | $25,911.00 | (900000 x 2.879%) |
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impson Company, a calendar year taxpayer, acquires an apartment building on March 22, 2018 for $900,000...
In November, 2018, Creative Corn Products, a calendar year taxpayer, placed into service its only equipment...
In November, 2018, Creative Corn Products, a calendar year taxpayer, placed into service its only equipment during the year. The equipment, which was purchased used, cost $2,615,000. All of the equipment qualified as 5 year property under MACRS. Assuming that the equipment is eligible for §179 but NOT eligible for 100% bonus depreciation, the maximum deduction that the taxpayer may claim with respect to the equipment is a. $510,000 b. $1,231,000 c. $971,500. d. $885,000. e. $306,000. f. $2,615,000 g...
On March 8, 2018, Holly purchased a residential apartment building. The cost basis assigned to the...
On March 8, 2018, Holly purchased a residential apartment building. The cost basis assigned to the building is $195,400. Holly also owns another residential apartment building that she purchased on April 15, 2018, with a cost basis of $738,000. Click here to access the depreciation tables. If required, round intermediate calculations and final answers to nearest dollar. a. Calculate Holly's total depreciation deduction for the apartments for 2018 using MACRS. $ b. Calculate Holly's total depreciation deduction for the apartments...
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4. Quattro Enterprises, a calendar-year taxpayer, leases the twentieth floor of a building downtown. Due to...
4. Quattro Enterprises, a calendar-year taxpayer, leases the twentieth floor of a building downtown. Due to employment expansion, it renovated the entire office space layout without changing the overall size of the office, spending $600,000 on these leasehold improvements (qualified improvement property). The office renovation was completed in May. Quattro also spent $1,000,000 on new computer systems and office furniture and fixtures in May on which the business used its entire Sec. 179 allowance for 2019. What is the maximum...
n's office building with an adjusted basis of $750,000and a fair market value of $900,000 is...
n's office building with an adjusted basis of $750,000and a fair market value of $900,000 is condemned on 8. Sam is a calendar year taxpayer. He receives a condemnation award of $875,000 on March 1, Whe, s a new office building at a cost of $845,000 which is completed and paid for on December 31, 2021. of the condemnation award and basis for the new office building assuming What is Sam's recognized gain on receipt his objective is to minimize...
LO 8.8 16. Jeanie acquires an apartment building in 2007 for $250,000 and sells it for...
LO 8.8 16. Jeanie acquires an apartment building in 2007 for $250,000 and sells it for $500,000 in 2018. At the time of sale there is $75,400 of accumulated straight-line depreciation on the apartment building. Assuming Jeanie is in the highest tax bracket for ordinary income and the Medicare tax applies, how much of her gain is taxed at 28.8 percent? a. None b. $325,400 c. $250,000 d. $174,600 e. $75,400
A Company placed into service an apartment building in March, 2018 which costs $200,000. Using MACRS...
A Company placed into service an apartment building in March, 2018 which costs $200,000. Using MACRS show the depreciation for 2018, 2019 and 2020. Show the adjusted basis after the 2020 depreciation
1. On June 1 of the current tax year, Tab converted a machine from personal use...
1. On June 1 of the current tax year, Tab converted a machine from personal use to use as rental property. At the time of the conversion, the machine was worth $70,000. Five years ago Tab purchased the machine for $120,000. The machine is subject to a $100,000 mortgage. What is the basis of the machine for depreciation purposes? a. $70,000 b. $90,000 c. $100,000 d. $120,000 e. $150,000 2. Hazel, a calendar-year taxpayer, purchased a new business asset (five-year...
38. A taxpayer places a $1,050,000 5-year recovery period asset in service in 2018. This is...
38. A taxpayer places a $1,050,000 5-year recovery period asset in service in 2018. This is the only asset placed in service in 2018. Assuming half-year convention, an election to expense under Section 179, and no income limitation, what is the amount of total cost recovery deduction (no bonus depreciation)? a. $200,000 b. $210,000 c. $1,000,000 d. $1,010,000 e. $1,050,000 ANSWER: d Please explain
9) Milo Corporation, a calendar-year taxpayer, purchases and places into service machinery with a 7-year life...
9) Milo Corporation, a calendar-year taxpayer, purchases and places into service machinery with a 7-year life that costs $1,140,000. It was placed in service early in the year and was the only addition this year. Milo elects to depreciate the maximum under Sec. 179 and does not apply bonus depreciation. Milo taxable income for the year before the Sec. 179 deduction is $1,700,000. What is Milo's total depreciation deduction related to this property? A) $1,140,000 B) $1,020,006 C) $162,906 D)...
4. Quattro Enterprises, a calendar-year taxpayer, leases the twentieth floor of a building downtown. Due to employment expansion, it renovated the entire office space layout without changing the overall size of the office, spending $600,000 on these leasehold improvements (qualified improvement property). The office renovation was completed in May. Quattro also spent $1,000,000 on new computer systems and office furniture and fixtures in May on which the business used its entire Sec. 179 allowance for 2019. What is the maximum...
n's office building with an adjusted basis of $750,000and a fair market value of $900,000 is condemned on 8. Sam is a calendar year taxpayer. He receives a condemnation award of $875,000 on March 1, Whe, s a new office building at a cost of $845,000 which is completed and paid for on December 31, 2021. of the condemnation award and basis for the new office building assuming What is Sam's recognized gain on receipt his objective is to minimize...
LO 8.8 16. Jeanie acquires an apartment building in 2007 for $250,000 and sells it for $500,000 in 2018. At the time of sale there is $75,400 of accumulated straight-line depreciation on the apartment building. Assuming Jeanie is in the highest tax bracket for ordinary income and the Medicare tax applies, how much of her gain is taxed at 28.8 percent? a. None b. $325,400 c. $250,000 d. $174,600 e. $75,400
38. A taxpayer places a $1,050,000 5-year recovery period asset in service in 2018. This is the only asset placed in service in 2018. Assuming half-year convention, an election to expense under Section 179, and no income limitation, what is the amount of total cost recovery deduction (no bonus depreciation)? a. $200,000 b. $210,000 c. $1,000,000 d. $1,010,000 e. $1,050,000 ANSWER: d Please explain
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