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Question

Margo, a calendar year taxpayer, paid $580,000 for new machinery (seven-year recovery property) placed in service

on August 1,2017.

a. Assuming that the machinery was the only tangible property placed in service during the year, compute Margo's maximum cost recovery deduction.

 

 

b. How would your computation change if Margo paid $2,100,000 for the machinery?

 

 

c. How would your computation change if Margo paid $2,750,000 for the machinery?

 

 

d. How would your answer to part a change if the machinery was purchased in 2018 instead of 2017?

Top Answer

a) 2017 Margo's maximum cost recovery deduction: Total cost of depreciable machinery = $580,000 Section 179 election and... View the full answer

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