Deduction for qualifying five-year equipment

Reference no: EM1358924

Elaine owns an unincorporated manufacturing business. In 2011, she purchases and places in service $250,000 of qualifying five-year equipment for use in her business. Her taxable income from the business before any section 179 deduction is $70,000. Elaine takes the maximum allowable deduction under section 179. Which of the following statements is true regarding the section 179 election?

A. Elaine can deduct $128,000 as a section 179 deduction in 2011.

B. Elaine can deduct $250,000 as a section 179 deduction in 2011.

C. Elaine can deduct $70,000 as a section 179 deduction in 2011; $180,000 may be carried over to next year.

D. Elaine can deduct $70,000 as a section 179 deduction in 2011 with no carryover to next year.

Reference no: EM1358924

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