Basis Assume that ACW Corporation has 2021 taxable income of $1,920,000 for purposes of computing the $179 expense. The company acquired the following assets during 2021 (assume no bonus depreciation): (Use MACRS Table 1. Table 2 and Table 5.) Asset Placed in Service Machinery 12-Sep $ 512,000 Computer equipment 18-Feb 112,008 Delivery truck 21-Aug 135,000 Qualified improvenent property 02-Apr 1,422,000 Total $ 2,181, eee a. What is the maximum amount of 5179 expense ACW may deduct for 2021? b. What is the maximum total depreciation that ACW may deduct in 2021 on the assets it placed in service in 2021? (Round your intermediate calculations and final answer to the nearest whole dollar amount.) $ a. Maximum $179 expense for 2021 b. Maximum total deductible depreciation for 2021 1,050,000 Table 1 MACRS Half-Year Convention Year 1 Year 2 Year 3 Year 4 8.55 20-Year 3.750% 7.219 6.677 6.177 5.713 5.285 Year 5 Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 33.33% 20.00% 14.29% 10.00% 5.00% 44.45 32.00 24.49 18.00 9.50 14.81 19.20 17.49 14.40 7.41 11.52 12.49 11.52 7.70 11.52 8.93 9.22 6.93 5.76 8.92 7.37 6.23 8.93 6.55 5.90 4.46 6.55 5.90 6.56 5.91 6.55 5.90 3.28 5.91 5.90 Year 6 Year 7 Year 8 4.888 4.522 Year 9 4.462 Year 10 Year 11 4.461 4.462 4.461 4.462 Year 12 Year 13 5.91 5.90 4.461 Year 14 Year 15 5.91 4.462 Year 16 2.95 4.461 4.462 4.461 Year 17 Year 18 Year 19 Year 20 Year 21 4.462 4.461 2.231 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 26 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 2 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 24 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 Year 8 7.64 8.73 TABLES Nonresidential Real Property Mid-Month Convention Straight Line 39 Years (for assets placed in service on or after May 13, 1993) Month Property Maced in Service Month 1 Mooth 2 Month Month 4 Months Month Month Month Month Year 1 2.4619 2247% 20398 1819 1.605 1.1915 1.177 0.9633 0.7499 Year 2-39 2.366 2.564 2.564 2564 2564 2564 2564 2564 2564 Year 40 0.107 0321 OSS 0749 1177 1. 1819 Month 10 0.5134 2561 2013 Month 11 0.3214 2554 2247 Month 12 0.107 2564 2461 1391
