Problem B-40 (Algorithmic) (LO. 2, 3, 9) On April 20, 2020, Javier Sanchez purchased and placed in service a new 7-year class asset costing $429,200 for use in his landscaping business, which he operates as a single member LLC (Sanchez Landscaping LLC). Rather than using bonus depreciation, Javier would like to use 5 179 to expense $200,000 of this asset and then use regular MACRS to cost recover the remaining cost. During 2020, his business generated a net income of $515,040 before any 5 179 immediate expense election If required round your intermediate computations and final answers to the nearest dollar. Click here to access the depreciation table to use for this problem. a. Determine the cost recovery deductions (including first year additional depreciation) that Javier Sanchez can claim with respect to this asset in 2020 and 2021. Total cost recovery deduction in 2020 s Total cost recovery deduction in 2021: s b. Complete Javier's Form 4562 (page 1) for 2020. Note: For 2020, the maximum 179 is $1,040,000 and the threshold amount is $2,590,000. If an amount is zero, enter "0". Enter amounts as positive numbers. Form 4562 Department of the Treasury Internal Revenue Service (99) Name(s) shown on return Javier Sanchez Part I Depreciation and Amortization (Including Information on Listed Property) Attach to your tax return. Go to www.irs.gov/Form4562 for instructions and the latest information. Business or activity to which this form relates Sanchez Landscaping, LLC Election To Expense Certain Property Under Section 179 Note: If you have any listed property, complete Part V before you complete Part 1. OMB No. 1545-0172 2020 Attachment Sequence No. 179 Identifying number 123-45-6789 3 Maximum amount (see instructions). 2 Total cost of section 179 property placed in service (see instructions) 2 . Threshold cost of section 179 property before reduction in limitation (see instructions). 3 4 Reduction in limitation Subtract line 3 from line 2. If zero or less, enter-0 4 5 Dollar limitation for tax year. Subtract line 4 from line 1. If zero or less, enter-0. If married filing separately, see instructions 6 (a) Description of property. (b) Cost (business use only) (c) Elected cost Landscaping equipment 7 Listed property. Enter the amount from line 29 - 7 B Total elected cost of section 179 property. Add amounts in column (c), lines 6 and 7 9 Tentative deduction. Enter the smaller of line 5 or line 8. 9 10 Carryover of disallowed deduction from line 13 of your 2019 Form 4562... 10 11 Business income limitation. Enter the smaller of business income (not less than zero) or line 5 (see instructions). 11 12 Section 179 expense deduction, Add Snes 9 and 10, but don't enter more than line 111 12 13 Carryover of disallowed deduction to 2021. Add lines 9 and 10, less line 12... 13 Note: Don't use Part 11 or Part I below for listed property. Instead, use Part V Previous Nest