Complete the tables and calculate the depreciations for each parts
Property Transactions Return Name: ___________ Class time: Dean and Ellen Price are married and have a manufacturing business. They bought a piece of business equipment (7-year personal property) on 4/1/2018 for $50,000. Use half-year convention to calculate the MACRS depreciation deduction on the equipment for 2018 and 2019 They also has a pick-up truck used for business (5-year recovery period) acquired on 8/23/2018 for $25,000. On 11/15/2019, he sold the pick-up truck for $24,000. Use the half-year convention to calculate the MACRS depreciation on the truck for 2018 and 2019. On 10/26/2019 Dean sold his old storage building used for his business for $220,000. They purchased the building in 2001 for $100,000. Total depreciation (accumulated depreciation) taken on the building is $20,000. His 2019 Business income and expenditures (Schedule -C): Sales $ 657,500 Cost of goods sold Other business expenses (incl. deprecation taken on the storage building) $ 315,000 $ 140,000 In 2019 Dean also sold various assets. The information about the selling price and depreciation of the property is listed below. Placed in Service / Purchased on Office tables 4/4/2018 Office chairs Marketable securities Land held for investment 3/1/2015 2/1/2019 7/1/2018 Sold on 10/16/2019 For $2,900 11/8/2019 For $4,000 12/1/2019 For $20,000 11/29/2019 For $48,000 Initial Cost 2019 Depr. Amount $3,000 $375 $8,000 $1,000 Accumulated Depreciation. (Depr. Allowed) Tax Basis= Initial Cost - Depr. Allowed 2175 $825 5800 $2,200 12000 $12,000 $0 $0 45000 $45,000 $0 $0 In 2019 Dean sold his wine collection for $9,000, which is bought two years ago for $8,000. They also has a short-term capital loss carryover of $10,000 from 2009. CALCULATE THE DEPRECIATION AND COMPLETE THE FOLLOWING TABLES 1 Property Transactions Return Name: ___________ Class time: Part I: Calculate MACRS Depreciations and Adjusted Basis 2018: Date Acquired (1) Business Equipment Date Disposed (2) MACRS Rate (3) Initial Cost (4) 2018 MACRS Depreciation Deduction (5) = (3)*(4) MACRS Rate Initial Cost 2019 MACRS Depreciation Deduction Initial Cost (3) Accumulated Depreciation (4) Tax Basis at year end (5) = (3)-(4). N/A Pick-up Truck 2019 Depreciation Date Acquired Business Equipment Date Disposed N/A Pick-up Truck (Sold during the year) use half a year convention at a year of sale 2019 Tax Basis Date Acquired (1) Business Equipment Pick-up Truck Date Disposed (2) N/A 2019 Net Schedule-C Business income _184, 880 ________________________________________ Property Transactions Return Name: ___________ Class time: Part II. Summary Sheet for the Sales of Business Property (Form 4797) Step 1) Sales or Exchanges of Property Used in a Trade or Business (Held for More Than 1 Year) Description of property (1) Date acquired (2) Date Sold (3) Gross Sales Price (4) Accumulated Tax Basis (6) Depreciation (5) Gain or (loss) (4-6) A) Truck B) storage building C) Office table D) office chairs Step 2) Ordinary Gains and Losses (incl. property held 1 year or less). Enter zero if not applicable. Description of property Date acquired Date Sold Gross Sales Price Accumulated Depreciation Adj. Basis Gain or (loss) 0 0 0 0 0 0 0 Step 3). Descriptions of Section 1245 property: 1) Description of property 2) 3) 4) 5) 6) Date acquired Date Sold Gain Accumulate d Amount of Gain reported as Ordinary Depreciation (Lesser of 4 or 5) 3 (a) Net the gains/loss in A,B,C,D ____________ 3 (b) Total Amount reported on (6) above: ______________________ 3 (c) = 3(a) - 3(b) _________ (Remaining Section 1231 Gain) 7) Remaining Gain = (4) - (6) Property Transactions Return Name: ___________ Class time: Property Transactions Return Name: ___________ Class time: (Part II. continued) Summary Sheet for the Sales of Business Property Step 4. Description of Section 1250 property 1) Descriptio n of property 2) 3) 4) 5) 6) Date acquired Date Sold Gain Depreciation allowed (Accumulated Depreciation) Unrecapture d 1250 Gain. Building 4(a) = Remaining Section 1231 Gain from 3(c): ________ 4(b): Total Unrecaptured 1250 Gain on 6) above ________ 4(c) = 4(a) - 4(b) ________ 7) Remaining Gain = (4) - (6) Property Transactions Return Name: ___________ Class time: Part III. Summary Sheet on the Sales of Capital Assets (Form 8949) 1). Short-term Description of property Date acquired Date Sold Gross Sales Price Depreciation allowed Cost Basis Gain or (loss) Date acquired Date Sold Gross Sales Price Depreciation allowed Cost Basis Gain or (loss) Mkt securities 2) Long-term Description of property Land wine Property Transactions Return Name: ___________ Class time: Property Transactions Return Name: ___________ Class time: Property Transactions Return Name: ___________ Class time
