During 2019, William purchases the following capital assets for use in his catering business: New passenger automobile (September 30) Baking equipment (June 30) $54,000 7,000 Assume that William decides to use the election to expense on the baking equipment and has adequate taxable income to cover the deduction) but not on the automobile (which has a 5-year recovery period), and he also uses the MACRS accelerated method to calculate depreciation but elects out of bonus depreciation. Click here to access the depreciation table and click here to access the annual automobile depreciation limitations. Calculate William's maximum depreciation deduction for 2019, assuming he uses the automobile 100 percent in his business. 9,800 x 27.5-Year Residential Real Property The applicable annual percentage is (use the column for the month in the first year the property is placed in service): Recovery Year(s) 1 1 2 3 4 9 10 12 5 2.273 7 1.667 11 0.455 3.485 2.879 1.061 0.152 3.182 3.636 1.970 3.636 8 1.364 3.636 3.637 2.576 3.636 3.637 0.758 3.636 2-18 3.636 3.636 3.636 3.636 3.636 3.637 3.636 3.636 3.637 19-27 3.637 3.637 3.637 3.637 3.637 3.637 3.637 2.273 28 1.970 2.576 2.879 3.637 3.182 0.000 3.636 3.636 3.636 3.636 3.485 0.000 3.636 0.152 3.636 0.455 29 0.000 0.000 0.000 0.000 0.758 1.061 1.364 1.667 39-Year Nonresidential Real Property The applicable annual percentage is (use the column for the month in the first year the property is placed in service): Recovery Year(s) 1 2 3 6 8 9 10 11 12 5 1.605 7 1.177 1 2.461 2.247 2.033 1.819 1.391 0.963 0.749 0.535 0.321 0.107 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2-39 40 0.107 0.321 0.535 0.749 0.963 1.177 1.391 1.605 1.819 2.033 2.247 2.461 ANNUAL AUTOMOBILE DEPRECIATION LIMITATIONS Year of Use 2019 Limits 2018 Limits Year 1 $18,100* $18,000* Year 2 16,100 16,000 Year 3 9,700 9,600 Year 4 (and subsequent 5,760 5,760 years until fully depreciated) * Additional bonus depreciation of $8,000 is included in this amount