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Posted on Jul 23, 2024

Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% Year

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Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% Year 2 44.45 32.00 24.49 18.00 9.50 7.219 Year 3 14.81 19.20 17.49 14.40 8.55 6.677 Year 4 7.41 11.52 12.49 11.52 7.70 6.177 Year 5 11.52 8.93 9.22 6.93 5.713 Year 6 5.76 8.92 7.37 6.23 5.285 Year 7 8.93 6.55 5.90 4.888 Year 8 4.46 6.55 5.90 4.522 Year 9 6.56 5.91 4.462 Year 10 6.55 5.90 4.461 Year 11 3.28 5.91 4.462 Year 12 5.90 4.461 Year 13 5.91 4.462 Year 14 5.90 4.461 Year 15 5.91 4.462 Year 16 2.95 4.461 Year 17 4.462 Year 18 4.461 Year 19 4.462 Year 20 4.461 Year 21 2.231 TABLE 2a MACRS Mid-Quarter Convention: For property placed in service during the first quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 35.00% 26.00 Year 2 Year 3 25.00% 21.43 15.31 15.60 11.01 10.93 11.01 8.75 Year 4 Year 5 Year 6 Year 7 Year 8 1.38 8.74 8.75 1.09 TABLE 26 MACRS Mid-Quarter Convention: For property placed in service during the second quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 25.00% 17.85% Year 2 30.00 23.47 Year 3 18.00 16.76 Year 4 11.37 11.97 11.37 8.87 Year 5 Year 6 Year 7 4.26 8.87 8.87 Year 8 3.34 TABLE 2c MACRS Mid-Quarter Convention: For property placed in service during the third quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 15.00% 10.71% Year 2 34.00 25.51 20.40 18.22 Year 3 Year 4 12.24 13.02 Year 5 11.30 9.30 Year 6 7.06 8.85 8.86 Year 7 Year 8 5.53 TABLE 20 MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 5.00% 3.57% Year 2 38.00 27.55 Year 3 22.80 19.68 Year 4 13.68 14.06 Year 5 10.94 10.04 Year 6 9.58 8.73 Year 7 8.73 Year 8 7.64 TABLE 3 Residential Rental Property Mid-Month Convention Straight Line27.5 Years Month 3 Month 9 Month 2 3.182% 3.636 Months 1.364% Month Property Placed in Service Month 5 Month 6 Month 7 2.273% 1.970% 1.667% 3.636 3.636 3.636 Month 1 3.485% 3.636 3.637 Year 1 Year 2-9 Year 10 Month 12 0.152% Month 4 2.576% 3.636 3.637 2.879% 3.636 3.637 Month 10 Month 11 0.758% 0.455% 3.636 3.636 1.061% 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.636 Year 11 3.636 3.636 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.637 3.637 Year 12 3.637 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.637 3.636 3.637 3.637 3.636 3.637 3.636 3.637 3.637 3.636 3.637 3.636 3.637 3.637 3.637 3.636 3.637 3.637 3.636 3.637 3.636 3.637 3.636 3.637 3.636 3.636 3.636 3.636 Year 13 Year 14 Year 15 Year 16 Year 17 3.636 3.637 3.636 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.637 3.637 3.636 3.637 3.637 3.637 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.636 3.636 3.636 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.637 3.637 3.636 3.637 3.636 Year 18 3.637 3.637 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.636 Year 19 3.636 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.637 3.637 3.637 3.636 Year 20 3.637 3.637 3.637 3.637 3.636 3.637 3.636 3.637 3.637 3.636 3.636 3.636 3.636 3.637 3.636 3.637 Year 21 3.636 3.637 3.636 3.637 3.636 3.637 3.637 3.636 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.636 3.637 3.636 3.637 3.637 3.636 3.637 3.637 3.636 3.636 3.637 3.636 3.637 3.636 3.636 3.637 3.637 Year 22 Year 23 Year 24 Year 25 3.637 3.637 3.637 3.637 3.637 3.636 3.636 3.636 3.636 3.636 3.636 3.637 3.636 3.637 3.636 3.637 3.636 3.636 3.636 3.636 3.636 3.637 3.637 3.637 3.637 3.637 3.636 Year 26 3.637 3.637 3.637 3.637 3.636 3.636 3.637 3.637 3.636 2.576 3.636 3.637 3.636 3.637 3.636 3.637 3.636 3.636 3.636 3.636 Year 27 Year 28 Year 29 3.637 3.636 3.637 3.636 1.97 2.273 2.879 3.182 3.485 3.636 3.636 3.636 3.636 3.636 0.152 0.455 0.758 1.061 1.364 1.667 Month 10 0.661% 3.175 3.175 Month 11 0.397% 3.175 3.175 3.175 3.175 3.174 Month 12 0.132% 3.175 3.175 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.174 3.175 3.174 TABLE 4 Nonresidential Real Property Mid-Month Convention Straight Line31.5 Years (for assets placed in service before May 13, 1993) Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Year 1 3.042% 2.778% 2.513% 2.249% 1.984% 1.720% 1.455% 1.190% 0.926% Year 2-7 3.175 3.175 3.175 3.175 3.175 3.175 3.175 3.175 3.175 Year 8 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.175 Year 9 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 10 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 11 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 12 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 13 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.174 Year 14 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 15 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 16 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 17 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 18 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 19 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 20 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 21 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 22 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 23 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.115 3.174 Year 24 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 25 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 26 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 27 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.174 Year 28 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 Year 29 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 30 3.175 3.174 3.175 3.174 3.175 3.174 3.174 3.175 Year 31 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 Year 32 1.720 1.984 2.249 2.513 2.778 3.042 3.175 3.174 3.175 Year 33 0.132 0.397 0.661 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.174 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.174 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 LLLL 3.175 3.174 3.175 3.174 1.455 3.174 3.175 0.926 1.190 TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line39 Years (for assets placed in service on or after May 13, 1993) Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Year 1 2.461% 2.247% 2.033% 1.819% 1.605% 1.391% 1.177% 0.963% 0.749 Year 2-39 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 2.564 Year 40 0.107 0.321 0.535 0.749 0.963 1.177 1.391 1.605 1.819 Month 10 0.535% 2.564 Month 11 0.321% 2.564 Month 12 0.107% 2.564 2.033 2.247 2.461 Required information [The following information applies to the questions displayed below.] On January 8 of year 1 Javier purchased and placed in service a building, including the land it was on, to assemble his new equipment. The total cost of the purchase was $1,399,500; $322,000 was allocated to the basis of the land and the remaining $1,077,500 was allocated to the basis of the building. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) a. Using MACRS, what is Javier's depreciation deduction on the building for years 1 through 3? Year Depreciation deduction 1 2 3 b. What would be the year 3 depreciation deduction if the building was sold on February 26 of year 3? Year 3 depreciation deduction d. Assume the building is residential property. Using MACRS, what is Javier's depreciation deduction on the building for years 1 through 3? Year Depreciation deduction 1 2 3