Determination of tax depreciation. Mike purchased a new lawn tractor for $6,000 on June 5, 2021, to use in his lawn care business. Mike plans to use the tractor between 40% and 70% for business. The normal MACRS GDS class life is five years and ADS class life is eight years.
Required:
a. Determine Mike’s MACRS depreciation for the first and second years assuming he uses the tractor 70% for business.
b. How would your answer change if he used it 40% for business?