Tracy is a self-employed CPA who purchases an automobile for $82,000 and places it into service in 2019. (Click the icon to view the Luxury Automobile Depreciation limits.) (Click the icon to view the MACRS half-year rates.) (Click the icon to view the ADS MACRS half-year rates.) Read the requirements. Requirement a. Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. Tracy uses the vehicle 80% for her business and 20% for personal purposes. Begin by identifying the asset class for the automobile. Asset Asset Class Automobile Now, calculate the MACRS current year depreciation deduction. (Use depreciation rates to three decimal places, X.XXX%. Round all currency amounts to the nearest dollar.) MACRS current year depreciation Asset Automobile Requirement b. Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. Tracy uses the vehicle 20% for her business and 80% for personal purposes. (Use depreciation rates to three decimal places, X.XXX%. Round all currency amounts to the nearest dollar.) MACRS current year Asset depreciation Automobile X Reference Luxury Automobile Depreciation Limits Year Automobile is placed in Service 2018 2012-2017 2010-2011 2009 $2,960 Year 1 $10,000 or $3,160 $3,060 $18,000* Year 2 16,000 5,100 4,900 Year 3 9,600 3,050 2,950 and Each 5,760 1,875 1,775 Suceeding Year *If the taxpayer does not elect out of bonus depreciation in 2018. 4,800 2,850 1,775 TAX AUTHORITY UPDATE At the time this edition went to print, the IRS had not yet released the 2019 ceiling limits. For this problem we assume the limits will be the same for 2019 as they were in 2018. Print Done Reference tic Alternative Depreciation System-MACRS (Partial Table) Property Placed in Service After 12/31/86 Applicable Convention: Half-Year Applicable Depreciation Method: Straight Line Recovery period and Depreciation Rates Recovery Year 3 4 5 7 10 12 16.67 10.00 7.14 Year 1 Year 2 12.50 25.00 25.00 33.33 4.17 8.33 14.29 5.00 10.00 10.00 20.00 20.00 Year 3 33.33 14.29 8.33 si Year 4 16.67 25.00 20.00 14.28 10.00 8.33 Year 5 12.50 20.00 14.29 10.00 8.33 Year 6 10.00 10.00 8.33 14.28 14.29 Year 7 10.00 8.34 Year 8 7.14 10.00 8.33 tid Year 9 10.00 8.34 e Year 10 10.00 8.33 Year 11 5.00 8.34 Year 12 8.33 Requirements he Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. a. Tracy uses the vehicle 80% for her business and 20% for personal purposes. b. Tracy uses the vehicle 20% for her business and 80% for personal purposes. Print Done He Tracy is a self-employed CPA who purchases an automobile for $82,000 and places it into service in 2019. (Click the icon to view the Luxury Automobile Depreciation limits.) (Click the icon to view the MACRS half-year rates.) (Click the icon to view the ADS MACRS half-year rates.) Read the requirements. Requirement a. Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. Tracy uses the vehicle 80% for her business and 20% for personal purposes. Begin by identifying the asset class for the automobile. Asset Asset Class Automobile Now, calculate the MACRS current year depreciation deduction. (Use depreciation rates to three decimal places, X.XXX%. Round all currency amounts to the nearest dollar.) MACRS current year depreciation Asset Automobile Requirement b. Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. Tracy uses the vehicle 20% for her business and 80% for personal purposes. (Use depreciation rates to three decimal places, X.XXX%. Round all currency amounts to the nearest dollar.) MACRS current year Asset depreciation Automobile X Reference Luxury Automobile Depreciation Limits Year Automobile is placed in Service 2018 2012-2017 2010-2011 2009 $2,960 Year 1 $10,000 or $3,160 $3,060 $18,000* Year 2 16,000 5,100 4,900 Year 3 9,600 3,050 2,950 and Each 5,760 1,875 1,775 Suceeding Year *If the taxpayer does not elect out of bonus depreciation in 2018. 4,800 2,850 1,775 TAX AUTHORITY UPDATE At the time this edition went to print, the IRS had not yet released the 2019 ceiling limits. For this problem we assume the limits will be the same for 2019 as they were in 2018. Print Done Reference tic Alternative Depreciation System-MACRS (Partial Table) Property Placed in Service After 12/31/86 Applicable Convention: Half-Year Applicable Depreciation Method: Straight Line Recovery period and Depreciation Rates Recovery Year 3 4 5 7 10 12 16.67 10.00 7.14 Year 1 Year 2 12.50 25.00 25.00 33.33 4.17 8.33 14.29 5.00 10.00 10.00 20.00 20.00 Year 3 33.33 14.29 8.33 si Year 4 16.67 25.00 20.00 14.28 10.00 8.33 Year 5 12.50 20.00 14.29 10.00 8.33 Year 6 10.00 10.00 8.33 14.28 14.29 Year 7 10.00 8.34 Year 8 7.14 10.00 8.33 tid Year 9 10.00 8.34 e Year 10 10.00 8.33 Year 11 5.00 8.34 Year 12 8.33 Requirements he Calculate Tracy's current year MACRS depreciation deduction, assuming she does not elect Sec. 179 expensing, she elects out of bonus depreciation, and the half-year convention applies. a. Tracy uses the vehicle 80% for her business and 20% for personal purposes. b. Tracy uses the vehicle 20% for her business and 80% for personal purposes. Print Done He