4. In EACH of the following situations the taxpayer is in the highest marginal tax bracket, which you should assume means 37% for ordinary income, 20% for net capital gains, and 25% for unrecaptured section 1250 gains. Show in the table below the amount of income, and the amount of that income taxed at each rate (25 points): a. The taxpayer purchases equipment for use in his business. The purchase cost is $120,000 and the entire amount is expensed using the Section 179 expense election. The asset is sold 3 years later for $60,000 b. The taxpayer purchases equipment for use in his business. The purchase cost is $120,000 and the entire amount is expensed using the Section 179 expense election. The asset is sold 3 years later for $160,000 c. The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $1,800,000 d. The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $800,000. e. The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $2,800,000 Situation Total income (2 each) 37% income (1) 25% income (1) 20% income (1) A B C D E