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ABC Bank Corporation follows a calendar year tax period. During its 2018 tax year, the business purchased the following assets: A desk and chair for

ABC Bank Corporation follows a calendar year tax period. During its 2018 tax year, the business purchased the following assets:

A desk and chair for each employee: purchased on March 15, totaling $400,000.

Desktop computers for each employee: purchased on April 3, totaling $500,000.

All of the above property is brand new and has been used entirely for business purposes since its purchase

(Does not constitute listed property that has mixed personal and business use).

The taxpayer desires themaximum total depreciation expense.

Further, assume that the company has sufficient taxable income such that,at least in terms of taxable income, there is no binding limitation on any potential Sec. 179 expense

A taxpayer claimed $300,000 in Sec. 179 expense and $200,000 in bonus depreciation and that the following is the remaining basis for each category after applying Sec. 179 and bonus depreciation:

Desks and chairs purchased on March 15, remaining basis: $150,000.

Computers purchased on April 3, remaining basis: $250,000.

What is the total depreciation expense for the taxpayer in 2018?

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TABLE 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period Year 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% 44.45 32.00 24.49 18.00 9.50 7.219 14.81 19.20 17.49 14.40 8.55 6.677 7.41 11.52 12.49 11.52 7.70 6.177 11.52 8.93 9.22 6.93 5.713 5.76 8.92 7.37 6.23 5.285 8.93 6.55 5.90 4.888 4.46 6.55 5.90 4.522 6.56 5.91 4.462 6.55 5.90 4.461 3.28 5.91 4.462 5.90 4,461 5.91 4.462 5.90 4.461 5.91 4.462 2.95 4.461 4.462 18 4.461 19 4.462 20 4.461 21 2.231 Mid-Quarter Depreciation Table for Personal Property by Quarter Placed in Service and Recovery Period (Excerpts from Rev. Proc. 87-57) First Quarter Second Quarter Third Quarter Fourth Quarter Year 5-year 7-year 5-year 7-year 5-year 7-year 5-year 7-year 35.00% 25.00% 25.00% 17.85% 15.00% 10.71% 5.00% 3.57% 26.00 21.43 30.00 23.47 34.00 25.51 38.00 27.55 15.60 15.31 18.00 16.76 20.40 18.22 22.80 19.68 11.01 10.93 11.37 11.97 12.24 13.02 13.68 14.06 11.01 8.75 11.37 8.87 11.30 9.30 10.94 10.04 1.38 8.74 4.26 8.87 7.06 8.85 9.58 8.73 8.75 8.87 8.86 8.73 1.09 3.33 5.53 7.64

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