In 2020, Theo purchases $16,000 of Section 179 property for use in his delivery business. During 2020,
Question:
In 2020, Theo purchases $16,000 of Section 179 property for use in his delivery business. During 2020, he has $12,000 in taxable income from his business. Assume that Theo elects not to claim bonus depreciation.
a. What is Theo’s maximum Section 179 deduction in 2020? Explain.
b. Theo’s business taxable income for 2021 is $5,000. He purchases $1,000 of new Section 179 property in 2021. What is Theo’s maximum Section 179 deduction for 2021?
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a The taxable income limitation applies to this scenario That is the maximum Section 179 deduction i...View the full answer
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Related Book For 
Concepts In Federal Taxation 2021
ISBN: 9780357141212
28th Edition
Authors: Kevin E. Murphy, Mark Higgins, Randy Skalberg
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