Question
Hazel, a calendar-year taxpayer, purchased a new business asset (five-year depreciation period) on September 30, 2018, at a cost of $200,000, and placed the asset
Hazel, a calendar-year taxpayer, purchased a new business asset (five-year depreciation period) on September 30, 2018, at a cost of $200,000, and placed the asset in service on the same day. This was the only asset Hazel placed in service in 2018. Hazel did not elect IRC 179 expensing or to take additional first-year (bonus) depreciation. On August 20, 2020, Hazel sold the asset. Determine the depreciation deduction for 2020 for the asset so that she can determine her adjusted basis at the time of the sale.
a. $8,000
b. $11,875
c. $19,000
d. $9,600
e. $19,200
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