Personal Property
Who defines a personal asset’s recovery period for tax purposes?
What is the IRS?
Real property always uses this method of depreciation?
What is the straight-line method?
Taxpayers who do not want to claim bonus depreciation must do this with their tax return to opt out.
What is attaching a statement electing out of bonus depreciation?
When more than 40% of tangible personal property placed in service during the year was during the 4th quarter.
What is the mid-quarter depreciation convention?
Mattel owns equipment that would normally have $8,000 of full-year depreciation in 2026. The equipment is sold in the 3rd quarter of 2026.
Using the mid-quarter convention, how much depreciation expense can the business claim in the year of disposition?
What is $5,000?
(= 8000 x 62.5%)
Nvidia’s cost basis in the warehouse it purchased on June 1, 2026, is $500,000. What is Nvidia’s 2026 depreciation on its warehouse?
What is $6,955?
A company purchases $2,000,000 of qualified property in 2025.
The bonus depreciation rate is 40% and the company elects no §179 expense.
What is the bonus depreciation deduction?
What is $800,000?
On July 22 of this year, Steve bought a machine to help him build the Dubai Tower. The machinery has a 7-year recovery period, and its original basis is $610,000.
Calculate Depreciation.
What is $87,169?
In 2026, Needoh Co. has the following assets in service:
- Needoh Maker, 7-yr property, cost $42,000.
- Office furniture, 5-year property, $18,000
- Specialized equipment, 10-year property, cost $90,000
Using the half-year convention rates, what is the business’s total depreciation deduction for 2026?
What is $18,602?
Needoh Maker: 42,000 x 14.29% = 3,600
Office Furniture: 18,000 x 20% = 6,001,80
Specialized Equipment: 90,000 x 10% = 9,000
3,600 + 6,001.80 + 9,000 = 18,601.80
Nvidia purchased a warehouse for $500,000 on June 1, 2026, and they sold the warehouse on April 4, 2027.
What is the company’s depreciation for the warehouse in the year of disposition? (Round to the nearest dollar)
What is $3,739?
A business purchases the following qualified property on January 3, 2024:
Computers: $1,000,000
Machinery: $500,000
Total qualified property = $1,500,000.
The company elects $300,000 of §179 expense.
What is the company’s bonus depreciation deduction?
What is $720,000?
Steve buys two pieces of equipment this year to continue building the Dubai Tower:
- August 17th, Delivery Truck (5-year): $25,000
- November 1, Machinery (7-year): $610,000
Calculate Depreciation.
What is $25,527?