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Depreciation Recapture on Business Asset Sale

Sole Proprietorship Business Income: $$75,000$

Sold a piece of equipment used in the business:

Proceeds: $$20,000$

Original Cost: $$55,000$

Accumulated Depreciation: $$42,000$

Interest and Dividend Income: $$600$

Itemized Deductions: $$16,000$

Allowable deduction for self$-$employment tax: $$6,000$

Calculate:

The amount and character of the gain on the equipment sale $($ordinary income vs$.$ capital gain$).$

AGI, Taxable Income, and Total Tax Liability