Question
Byron entered into a 36-month lease of an automobile on March 1, year 1. He used it 80 percent for business and 20 percent for
Byron entered into a 36-month lease of an automobile on March 1, year 1. He used it 80 percent for business and 20 percent for personal use. In year 2 he used it 90 percent for business and 10 percent for personal use. The fair market value of the automobile at the inception of the lease was $68,000. Byron made 10 monthly lease payments of $660 in year 1 and 12 monthly payments in year 2. The IRS lease inclusion table amounts are $81 for the first year and $179 for the second year. What is Byrons deduction for lease payments made during year 1?
What is his deduction for year 2? What is the lease inclusion amount that Byron must include in his gross income for year 1?
What amount must he include in income for year 2?
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