Question

Mary purchased a new five-year class asset on March 7, of the current year. The asset was listed property (not an automobile). It was used 70% for business and the rest of the time for personal use. The asset cost $20,000. Mary made the § 179 election. The income from the business before the § 179 deduction was $200,000. Determine the total deductions with respect to the asset for 2019.

1. $6,000
2. $10,000
3. $14,000
4. $20,000

Answer 1

$14,000
Cost for business use: $14,000
(70% ×$20,000)
§ 179 expense (no business income limitation)	$14,000
You can take the 179 deductions by electing it. The amount of the
deduction is the total cost of all of the property, up to $500,000 for
each individual item of property. The total Section 179 deductions
for all property can't exceed the $2 million maximum.