Ilene owns an unincorporated manufacturing business. In 2018, she purchases and places in service $2,536,000 of qualifying five-year equipment for use in her business. Her taxable income from the business before any depreciation deduction is $900,000. Ilene will elect out of bonus depreciation but plans to take the maximum allowable deduction under Sec. 179. Which of the following statements is true regarding the Sec. 179 election?
A. Ilene can deduct $900,000 as a Sec. 179 deduction in 2018, with no carryover to next year.
B. IIene can deduct $900,000 as a Sec. 179 deduction in 2018; $64,000 may be carried over to next year.
C. Ilene can deduct $1,000,000 as a Sec. 179 deduction in 2018, with no carryover to next year.
D. Ilene can deduct $964,000 as a Sec. 179 deduction in 2018, with no carryover to next year.
Answer: B
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