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Problem 8-38 (LO. 2, 3, 9) Lori, who is single, purchased and placed in service 5-year class property for $200,000 and 7-year class property for
Problem 8-38 (LO. 2, 3, 9) Lori, who is single, purchased and placed in service 5-year class property for $200,000 and 7-year class property for $420,000 on May 20 , 2023. Lori expects the taxable income derived from her business (before considering any amount expensed under 179 ) to be about $550,000. Lori has determined that she should elect immediate 179 expensing in the amount of $520,000, but she doesn't know which asset she should completely expense under \& 179. She does not claim any available additional first-year depreciation. Click here to access Exhibit 8.1 and the depreciation table to use for this problem. If an amount is zero, enter " 0 ". a. Determine Lori's total cost recovery deduction if the 179 expense is first taken with respect to the 5-year class asset. c. What is your advice to Lori? If 179 expense is first allocated to the the cost recovery deduction for the year would be $ X larger
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