REG # 1589

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    Green Valley, Inc., purchased and placed in service a $130,000 piece of used equipment in a year with a maximum allowable Section 179 amount of $25,000 and a ceiling of $200,000 of qualifying property. No other property was placed into service during the year and the 50% bonus depreciation is not an option for 2014. The equipment is 7-year property. The first-year depreciation for 7-year property is 14.29%. Before consider­ing any depreciation deduction, Green Valley had $300,000 of taxable income. Rounding to the nearest dollar, what amount is the maximum allowable depreciation deduction?

    A. $130,000

    B. $25,000

    C. $40,005

    D. $500,000

    The correct answer and info given in the question are contradictory. The right answer, D, is based on the old 2014 500k Sec 179 deduction, and the question includes both the year 2014 and the 25k ceiling in place for 2015. Shouldn't this be changed to reflect the 2015 limits?

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