Question

The only asset Bill purchased during 2019 was a new seven-year class asset. The asset, which was listed property, was acquired on June 17 at a cost of $50,000. The asset was used 40% for business, 30% for the production of income, and the rest of the time for personal use. Bill always elects to expense the maximum amount under § 179 whenever it is applicable. The net income from the business before the § 179 deduction is $100,000. Determine Bill's maximum deduction with respect to the property for 2019. a.$26,749 b.$1,428 c.$2,499 d.$33,375

Answer 1

c.$2,499

Step-by-step explanation:

Asset acquired on June 17 at a cost of $50,000.

The asset was used 40% for business, 30% for the production of income(40%+30%)= 70%

Hence:

$50,000 x .70 x .0714

= $2,499

Therefore Bill's maximum deduction with respect to the property for 2019 will be $2,499