7. 13.29 You use a car in a majority of your sole-proprietorship engineering consulting business. This business asset cost you $80,000 new and has been depreciated according to MACRS over a 5-year period. At the end of year 4, you bought a replacement vehicle and traded for a net positive $15,000 on the old car. Determine if depreciation recapture or a capital loss is present and, if so, how much. 8. 13.30 An automated assembly robot that cost $300,000 has a recovery period of 5 years with an expected $50,000 salvage value. The MACRS depreciation rates for years 1, 2, 3, and 4 are 20.0%, 32.0%, 19.2%, and 11.52%, respectively.

(a) What is the depreciation recapture, capital gain, or capital loss, provided the robot was sold after 3 years for $80,000?

(b) How is this amount taxed?