Equipment associated with manufacturing small railcars had a first cost of $150,000 with an expected salvage value of $30,000 at the end of its 5-year life. The revenue was $636,000 in year 2, with operating expenses of $98,000. If the company's effective tax rate was 37%, what would be the difference in taxes paid in year 2 if the depreciation method were straight line instead ofModified Accelerated Cost Recovery System (MACRS)? The MACRSdepreciation rate for year 2 is 32%.

The difference in taxes paid is determined to be $