In 2016, Company W elected under Section 179 to expense $19,300 of the cost of qualifying... Question: In 2016, Company W elected under Section 179 to expense$19,300 of the cost of qualifying property. However, it could deduct only $15,000 of the expense because of the taxable income limitation. In 2017, Company W's taxable income before any Section 179 deduction was$812,000. Compute its 2017 Section 179 deduction if the total cost of qualifying property purchased in 2017 was $508,000. Section 179: Section 179 allows assessee to charge the whole of the investment in the long-term as depreciation expense in the first year of its' use but, the asset should be placed for more than a six-month period. Answer and Explanation: During 2017, Section 179 deduction is$508,000.

Explanation: During 2017, Section 179 deduction is $508,000 which is lower of investment amount and the allowed deduction. Working Note: The maximum allowed deduction under section 179 is 80% of the current year profit i.e.$649,600 (\$812,000 x 80%).