MACRS (LO. 6) Harold purchases the following business assets on the dates indicated: Mic Asset Date Purchased Cost Recovery Period Photocopy equipment 2/14/19 5 $50,000 $300,000 Dump truck 7/16/19 5 Bus 12/24/19 $1,021,000 5 ship 10. Mic Refer to the MACRS Depreciation Tables to answer the following questions. a. Harold's 2019 cost recovery deduction if he elects not to claim bonus depreciation and does not elect to expense any of the assets under Section 179 is 113,550 b. What could Harold do to maximize his 2019 deduction? Because the calculation of purchases for purposes of the 40% rule uses the depreciable basis placed in service each quarter Harold can avoid the annual convention by electing to expense $1,020,000 of the bus This reduces the depreciable basis of the photocopy equipment to $1,000 and the total depreciable basis placed in service during the year to 5351,000. Based on the election to expense determined above, Harold will be able to use the regular MACRS method. His total deduction is $ of depreciation in 2019 1,020,000 election to expense pluss of regular MACRS cost-recovery). Mica 106 and ation pdf Microso Draft 3.pdf eBook MACRS Depreciation Tables MACRS (LO. 6) Harold purchases the following business assets on the dates indicated: Asset Date Purchased Cost Recovery Period Photocopy equipment 2/14/19 $50,000 5 Dump truck 7/16/19 $300,000 5 Bus 12/24/19 $1,021,000 5 Refer to the MACRS Depreciation Tables to answer the following questions. a. Harold's 2019 cost-recovery deduction if he elects not to claim bonus depreciation and does not elect to expense any of the assets under Section 179 is 113,550 b. What could Harold do to maximize his 2019 deduction? Because the calculation of purchases for purposes of the 40% rule uses the depreciable basis placed in service each quarter Harold can avoid the annual convention by electing to expense $1,020,000 of the bus This reduces the depreciable basis of the photocopy equipment to $1,000 and the total depreciable basis placed in service during the year to $351,000. Based on the election to expense determined above, Harold will be able to use the regular MACRS method. His total deduction is $ of depreciation in 2019 ( 1,020,000 election to expense plus $ of regular MACRS cost-recovery)