Question

Carlos purchased an apartment building on November 16, 2020, for $3,000,000. Determine the cost recovery deduction for 2020. a.$11,910 b.$13,650 c.$22,740 d.$9,630

Answer 1

b. the cost recovery deduction is $13,650

Step-by-step explanation:

The computation of the cost recovery deduction is given below;

Cost recovery = cost of apartment building × 0.455%

= $3,000,000 × 0.455%

= $13,650

We multiply the cost of department building with the percentage i.e. 0.455% so that the cost recovery deduction could come

hence, the cost recovery deduction is $13,650