Alice purchases a rental house on August 22,2019, for a cost of $174,000. Of this amount, $100,000 is considered to be allocable to the cost of the home, with the remaining $74,000 allocable to the cost of the land. What is Alice's maximum
- $2,373
- $1,970
- $1,364
- $1,061
- $1,009
Introduction:The modified accelerated cost recovery system (MACRS) is a method of depreciation used for tax purposes in the U.S. It enables taxpayers to recover the capitalized cost of an asset over its life annually as per tax law.
To choose:The correct answer to determine the maximum depreciation deduction for 2019 using MACRS.
Answer to Problem 1MCQ
Final answer is [c] $1,364
Explanation of Solution
Calculation of maximum depreciation deduction for 2019 on real property assuming mid-month conversion will be for the month of August:
Therefore, option c is the correct option.
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- Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT