Hans purchased a new passenger automobile on August 17, 2017, for $30,000 . During the year the car was used 40% for business and 60% for personal use. Determine his cost recovery deduction for the car for 2017
a. $500
b. $1,000
c. $1,224
d. $1,500
e. None of the above
e
RATIONALE: The car, which is listed property, does not pass the predominantly business usage test. Therefore, neither § 179 expensing nor additional first-year depreciation can be taken.
$30,000 × .100 = $3,000 (not over $3,160 limit*). $3,000 × 40% = $1,200 .
These depreciation limits are indexed annually.
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