Copyright

1. AMP Corporation (calendar year-end) has 2017 taxable income of $900,000 before the 179...

Question:

1. AMP Corporation (calendar year-end) has 2017 taxable income of $900,000 before the 179 expense. During 2017, AMP acquired the following assets:

Asset Placed in Service Basis
Machinery September 12 $1,530,000
Computer Equipment February 10 355,000
Office Building April 2 480,000
Total $2,365,000

Required:

What is the maximum amount of Section 179 expense AMP may deduct for 2017?

2. Assume that TDW Corporation (calendar year-end) has 2017 taxable income of $650,000 before the Section 179 expense, acquired the following assets during 2017:

Asset Placed in Service Basis
Machinery October 12 $1,290,000
Computer Equipment February 10 274,000
Furniture April 2 880,000
Total $2,444,000

Required:

What is the maximum amount of Section 179 expense TDW may deduct for 2017?

3. Assume that Timberline Corporation has 2017 taxable income of $185,000 before the Section 179 expense?

Asset Purchase Date Basis
Furniture (7-year) December 1 $350,000
Computer Equipment (5-year) February 28 90,000
Copier (5-year) July 15 30,000
Machinery (7-year) May 22 480,000
Total $950,000

Required:

What is the maximum amount of Section 179 expense Timberline may deduct for 2017?

Section 179 Deduction

Section 179 deduction is applied to properties with physical substance purchased to be used in business. Under this section, taxpayers can deduct the cost of a property when computing for the taxable income of the business,

Answer and Explanation:

Become a Study.com member to unlock this answer! Create your account

View this answer

Requirement 1.

...
Item Description Amount
1 Total qualified asset $2,365,000
2 Threshold

See full answer below.


Learn more about this topic:

Loading...
Income Tax: Tax Liability & Deductions

from

Chapter 3 / Lesson 5
14K

Related to this Question

Explore our homework questions and answers library