Question
Tax situation - your tax client purchased these items in 2020 for his landscaping business; a new tractor for $50,000 on May 1, new tractor
Tax situation - your tax client purchased these items in 2020 for his landscaping business; a new tractor for $50,000 on May 1, new tractor implements for $10,000 on May 1, a new trailer for $12,000 on June 30 (all 7 yr equipment) and an SUV for $68,000 on June 30. The SUV weights over 6,000 pounds and is used 100% for business. Your client wants to know what his options are for depreciating this equipment.
- What would be the maximum amount of depreciation he could elect to take for 2020? Explain/show how you calculated this amount.
- What is the minimum depreciation he could take in 2020? Explain/show how you calculated this amount
- What are the advantages and disadvantages of taking the minimum and maximum?
- What is your recommendation, give your reasoning.
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Accounting Information Systems basic concepts and current issues
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130855849X, 978-1308558493, 78025338, 978-0078025334
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