Besides working for the Native America Law Firm, Michael also has his private consulting practice (Lapin Legal Consultancy, LLC, EIN: 55-5687541, Business code: 541110, Accounting method: Cash Basis), located at 195 Chambers Street, New York, NY 10007. The income and expenses associated with his practice are as follows: Gross Receipts 320,500 Rent 125,000 Office Salaries 75,000 Office Supplies 11,000 Advertisement 9,000 Utilities 8,000 Phone/Internet 3,000 Accounting Fees 12,000 Health Insurance Plan Employees 15,000 Office Maintenance 5,000 Office Equipment (see Note 1) 30,000 Travel (see Note 2) 6,000 Miscellaneous 1,500 Damages (see Note 3) 90,000 Note 1 the category office equipment includes printers, computers, fax machines, percolators, phones, microwaves, and office refrigerators. The items were placed in service during 2022. Michael is unfamiliar with the tax treatment and therefore requires your help. He is of great concern with the tax benefits available for the costs incurred for office equipment. Hint: should he capitalize and depreciate the equipment cost, or is another tax treatment available? Note 2 Michael visited Miami at a conference that was specific to his business. He spent a total of three days in Miami. However the conference was only two days, but since Michael loved the beach; he decided to stay another day. The total expenses incurred on the trip were 6,000. Note 3 Lapin Legal Consultancy, LLC, was sued by the US government, regarding a criminal violation of antitrust laws. He entered a no-contest plea and paid the fine of 90,000 to settle the case.

Prepare Schedule C complete report