Herelt Inc., a calendar year taxpayer, purchased equipment for $407,600 and placed it in service on April 1, 2020. The equipment was seven-year recovery property, and Herelt used the half-year convention to compute MACRS depreciation. Use Table 7-2. Required: Compute Herelts MACRS depreciation with respect to the equipment for 2020 and 2021. Compute Herelts adjusted basis in the equipment on December 31, 2021. Compute Herelts MACRS depreciation for 2022 if it disposes of the equipment on February 9, 2022.

Recovery Period TABLE 7.2 MACRS for Business Personalty (Half-Year Convention) 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 33.33% 44.45 14.81 7.41 20.00% 32.00 19.20 11.52 11.52 5.76 1 2 3 4 5 6 7 8 9 10 11 12 13 Depreciation Rate 14.29% 10.00% 24.49 18.00 17.49 14.40 12.49 11.52 8.93 9.22 8.92 7.37 8.93 6.55 4.46 6.55 6.56 6.55 3.28 5.00% 9.50 8.55 7.70 6.93 6.23 5.90 5.90 5.91 5.90 5.91 5.90 5.91 5.90 5.91 2.95 3.750% 7.219 6.677 6.177 5.713 5.285 4.888 4.522 4.462 4.461 4.462 4.461 4.462 4.461 4.462 4.461 4.462 4.461 4.462 4.461 2.231 14 15 16 17 18 19 20 21