On April 5, 2018, Mary purchased and placed in service, new seven year class ass

Question

On April 5, 2018, Mary purchased and placed in service, new seven year class assets costing $540,000 and five year class assets costing $140,000. Both assets were placed in service on April 5, 2018. She elects to expense the maximum out under 179. She does take additional first year depreciation. Assume taxable income is not s limitation. Determine Mary’s maximum cost recovery with respect to the assets in 2018
On April 5, 2018, Mary purchased and placed in service, new seven year class assets costing $540,000 and five year class assets costing $140,000. Both assets were placed in service on April 5, 2018. She elects to expense the maximum out under 179. She does take additional first year depreciation. Assume taxable income is not s limitation. Determine Mary’s maximum cost recovery with respect to the assets in 2018

Explanation / Answer

The maximum amount you can elect to deduct for most section 179 property you placed in service in tax years beginning in 2018 is $1,000,000. This limit is reduced by the amount by which the cost of section 179 property placed in service during the tax year exceeds $2,500,000.

So, we can take total of $680,000 as Depreciation.

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