Ilene Owns an Unincorporated Manufacturing Business

question 50

Multiple Choice

Ilene owns an unincorporated manufacturing business.In 2014,she purchases and places in service $206,000 of qualifying five-year equipment for use in her business.Her taxable income from the business before any Sec.179 deduction is $17,000.Elaine takes the maximum allowable deduction under section 179.Which of the following statements is true regarding the Sec.179 election?

• A)Ilene can deduct $25,000 as a section 179 deduction in 2014,with no carryover to next year.
• B)Ilene can deduct $19,000 as a section 179 deduction in 2014.
• C)IIene can deduct $17,000 as a section 179 deduction in 2014; $2,000 may be carried over to next year.
• D)Ilene can deduct $17,000 as a section 179 deduction in 2014 ,with no carryover to next year.

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Definitions:

Tax Rate

The percentage of one's income or the value of a good, service, or asset that is paid as tax to the government.

Market Value

The existing cost at which a service or asset is available for purchase or sale in the market.

Sales Tax

A tax imposed by government on sales of goods and services, typically computed as a percentage of the sale price.

Delivery Charge

A fee charged by a seller to cover the cost of delivering goods to a buyer's location.