Assume that Timberline Corporation has 2018 taxable income of $278,000 for purposes of computing the 179 expense It acquired the following assets in 2018 (Use MACRS Table 1, Table 2, Table 3, Table 4and Table 5 ) Asset Purchase Date Basis Furniture (7 year) December 1 $ 488,000 Computer equipment (5 year) February 28 128,000 Copier (5 year) July 15 68,000 Machinery (7 year) May 22 518,000 Total $ 1,202,000 a 1 What is the maximum amount of 179 expense Timberline may deduct for 2018 a 2 What is Timberlines 179 carryforward to 2019, if any b What would Timberlines maximum depreciation deduction be for 2018 assuming no bonus depreciation (Round your intermediate calculations to the nearest whole dollar amount ) c What would Timberlines maximum depreciation deduction be for 2018 if the machinery cost $3,380,000 instead of $518,000 and assuming no bonus depreciation (Round your intermediate calculations to the nearest whole dollar amount Table 1 MACRS Half Year Convention Depreciation Rate for Recovery Period 3 Year 5 Year 7 Year 10 Year 15 Year 20 Year Year 1 33 33 20 00 14 29 10 00 5 00 3 750 Year 2 44 45 32 00 24 49 18 00 9 50 7 219 Year 3 14 81 19 20 17 49 14 40 8 55 6 677 Year 4 7 41 11 52 12 49 11 52 7 70 6 177 Year 5 11 52 8 93 9 22 6 93 5 713 Year 6 5 76 8 92 7 37 6 23 5 285 Year 7 8 93 6 55 5 90 4 888 Year 8 4 46 6 55 5 90 4 522 Year 9 6 56 5 91 4 462 Year 10 6 55 5 90 4 461 TABLE 2a MACRS Mid Quarter Convention For property placed in service during the first quarter Depreciation Rate for Recovery Period 5 Year 7 Year Year 1 35 00 25 00 Year 2 26 00 21 43 Year 3 15 60 15 31 Year 4 11 01 10 93 Year 5 11 01 8 75 Year 6 1 38 8 74 Year 7 8 75 Year 8 1 09 TABLE 2b MACRS Mid Quarter Convention For property placed in service during the second quarter Depreciation Rate for Recovery Period 5 Year 7 Year Year 1 25 00 17 85 Year 2 30 00 23 47 Year 3 18 00 16 76 Year 4 11 37 11 97 Year 5 11 37 8 87 Year 6 4 26 8 87 Year 7 8 87 Year 8 3 34 TABLE 2c MACRS Mid Quarter Convention For property placed in service during the third quarter Depreciation Rate for Recovery Period 5 Year 7 Year Year 1 15 00 10 71 Year 2 34 00 25 51 Year 3 20 40 18 22 Year 4 12 24 13 02 Year 5 11 30 9 30 Year 6 7 06 8 85 Year 7 8 86 Year 8 5 53 TABLE 2d MACRS Mid Quarter Convention For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5 Year 7 Year Year 1 5 00 3 57 Year 2 38 00 27 55 Year 3 22 80 19 68 Year 4 13 68 14 06 Year 5 10 94 10 04 Year 6 9 58 8 73 Year 7 8 73 Year 8 7 64 TABLE 3 Residential Rental Property Mid Month Convention Straight Line27 5 Years Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1 3 485 3 182 2 879 2 576 2 273 1 970 1 667 1 364 1 061 0 758 0 455 0 152 Year 2 9 3 636 3 636 3 636 3 636 3 636 3 636 3 636 3 636 3 636 3 636 3 636 3 636 Year 10 3 637 3 637 3 637 3 637 3 637 3 637 3 636 3 636 3 636 3 636 3 636 3 636 Year 11 3 636 3 636 3 636 3 636 3 636 3 636 3 637 3 637 3 637 3 637 3 637 3 637 Year 12 3 637 3 637 3 637 3 637 3 637 3 637 3 636 3 636 3 636 3 636 3 636 3 636 Year 13 3 636 3 636 3 636 3 636 3 636 3 636 3 637 3 637 3 637 3 637 3 637 3 637 Year 14 3 637 3 637 3 637 3 637 3 637 3 637 3 636 3 636 3 636 3 636 3 636 3 636 TABLE 4 Nonresidential Real Property Mid Month Convention Straight Line31 5 Years (for assets placed in service before May 13, 1993) Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1 3 042 2 778 2 513 2 249 1 984 1 720 1 455 1 190 0 926 0 661 0 397 0 132 Year 2 7 3 175 3 175 3 175 3 175 3 175 3 175 3 175 3 175 3 175 3 175 3 175 3 175 Year 8 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 175 3 175 3 175 3 175 3 175 Year 9 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 Year 10 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 Year 11 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 3 174 3 175 TABLE 5 Nonresidential Real Property Mid Month Convention Straight Line39 Years (for assets placed in service on or after May 13, 1993) Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1 2 461 2 247 2 033 1 819 1 605 1 391 1 177 0 963 0 749 0 535 0 321 0 107 Year 239 2 564 2 564 2 564 2 564 2 564 2 564 2 564 2 564 2 564 2 564 2 564 2 564 Year 40 0 107 0 321 0 535 0 749 0 963 1 177 1 391 1 605 1 819 2 033 2 247 2 461

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Assume that Timberline Corporation has 2018 taxable income of $278,000 for purposes of computing the 179 expense. It acquired the following assets in 2018: (Use

Assume that Timberline Corporation has 2018 taxable income of $278,000 for purposes of computing the 179 expense. It acquired the following assets in 2018: (Use MACRS Table 1, Table 2, Table 3, Table 4and Table 5.)


Asset	Purchase Date		Basis
Furniture (7-year)	December 1	$	488,000
Computer equipment (5-year)	February 28		128,000
Copier (5-year)	July 15		68,000
Machinery (7-year)	May 22		518,000
Total		$	1,202,000

a-1. What is the maximum amount of 179 expense Timberline may deduct for 2018?
a-2. What is Timberlines 179 carryforward to 2019, if any?
b. What would Timberlines maximum depreciation deduction be for 2018 assuming no bonus depreciation? (Round your intermediate calculations to the nearest whole dollar amount.)
c. What would Timberlines maximum depreciation deduction be for 2018 if the machinery cost $3,380,000 instead of $518,000 and assuming no bonus depreciation? (Round your intermediate calculations to the nearest whole dollar amount.

Table 1 MACRS Half-Year Convention

Depreciation Rate for Recovery Period
	3-Year	5-Year	7-Year	10-Year	15-Year	20-Year
Year 1	33.33%	20.00%	14.29%	10.00%	5.00%	3.750%
Year 2	44.45	32.00	24.49	18.00	9.50	7.219
Year 3	14.81	19.20	17.49	14.40	8.55	6.677
Year 4	7.41	11.52	12.49	11.52	7.70	6.177
Year 5		11.52	8.93	9.22	6.93	5.713
Year 6		5.76	8.92	7.37	6.23	5.285
Year 7			8.93	6.55	5.90	4.888
Year 8			4.46	6.55	5.90	4.522
Year 9				6.56	5.91	4.462
Year 10				6.55	5.90	4.461

TABLE 2a MACRS Mid-Quarter Convention: For property placed in service during the first quarter

Depreciation Rate for Recovery Period
	5-Year	7-Year
Year 1	35.00%	25.00%
Year 2	26.00	21.43
Year 3	15.60	15.31
Year 4	11.01	10.93
Year 5	11.01	8.75
Year 6	1.38	8.74
Year 7		8.75
Year 8		1.09

TABLE 2b MACRS Mid-Quarter Convention: For property placed in service during the second quarter

Depreciation Rate for Recovery Period
	5-Year	7-Year
Year 1	25.00%	17.85%
Year 2	30.00	23.47
Year 3	18.00	16.76
Year 4	11.37	11.97
Year 5	11.37	8.87
Year 6	4.26	8.87
Year 7		8.87
Year 8		3.34

TABLE 2c MACRS Mid-Quarter Convention: For property placed in service during the third quarter

Depreciation Rate for Recovery Period
	5-Year	7-Year
Year 1	15.00%	10.71%
Year 2	34.00	25.51
Year 3	20.40	18.22
Year 4	12.24	13.02
Year 5	11.30	9.30
Year 6	7.06	8.85
Year 7		8.86
Year 8		5.53

TABLE 2d MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter

Depreciation Rate for Recovery Period
	5-Year	7-Year
Year 1	5.00%	3.57%
Year 2	38.00	27.55
Year 3	22.80	19.68
Year 4	13.68	14.06
Year 5	10.94	10.04
Year 6	9.58	8.73
Year 7		8.73
Year 8		7.64

TABLE 3 Residential Rental Property Mid-Month Convention Straight Line27.5 Years

Month Property Placed in Service
	Month 1	Month 2	Month 3	Month 4	Month 5	Month 6	Month 7	Month 8	Month 9	Month 10	Month 11	Month 12
Year 1	3.485%	3.182%	2.879%	2.576%	2.273%	1.970%	1.667%	1.364%	1.061%	0.758%	0.455%	0.152%
Year 2-9	3.636	3.636	3.636	3.636	3.636	3.636	3.636	3.636	3.636	3.636	3.636	3.636
Year 10	3.637	3.637	3.637	3.637	3.637	3.637	3.636	3.636	3.636	3.636	3.636	3.636
Year 11	3.636	3.636	3.636	3.636	3.636	3.636	3.637	3.637	3.637	3.637	3.637	3.637
Year 12	3.637	3.637	3.637	3.637	3.637	3.637	3.636	3.636	3.636	3.636	3.636	3.636
Year 13	3.636	3.636	3.636	3.636	3.636	3.636	3.637	3.637	3.637	3.637	3.637	3.637
Year 14	3.637	3.637	3.637	3.637	3.637	3.637	3.636	3.636	3.636	3.636	3.636	3.636

TABLE 4 Nonresidential Real Property Mid-Month Convention Straight Line31.5 Years (for assets placed in service before May 13, 1993)

Month Property Placed in Service
	Month 1	Month 2	Month 3	Month 4	Month 5	Month 6	Month 7	Month 8	Month 9	Month 10	Month 11	Month 12
Year 1	3.042%	2.778%	2.513%	2.249%	1.984%	1.720%	1.455%	1.190%	0.926%	0.661%	0.397%	0.132%
Year 2-7	3.175	3.175	3.175	3.175	3.175	3.175	3.175	3.175	3.175	3.175	3.175	3.175
Year 8	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.175	3.175	3.175	3.175	3.175
Year 9	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175
Year 10	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174
Year 11	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175	3.174	3.175

TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line39 Years (for assets placed in service on or after May 13, 1993)

Month Property Placed in Service
	Month 1	Month 2	Month 3	Month 4	Month 5	Month 6	Month 7	Month 8	Month 9	Month 10	Month 11	Month 12
Year 1	2.461%	2.247%	2.033%	1.819%	1.605%	1.391%	1.177%	0.963%	0.749%	0.535%	0.321%	0.107%
Year 239	2.564	2.564	2.564	2.564	2.564	2.564	2.564	2.564	2.564	2.564	2.564	2.564
Year 40	0.107	0.321	0.535	0.749	0.963	1.177	1.391	1.605	1.819	2.033	2.247	2.461