MACRS, Section 179, And Bonus Depreciation Practice Test

In 2025, a sole proprietorship operating a manufacturing business purchased and placed in service qualifying equipment on December 20, 2025, for $1,300,000. The taxpayer purchased no other Section 179 property during 2025. For 2025, the Section 179 annual deduction limit is $1,250,000 and the phase-out threshold begins at $3,130,000. What is the maximum Section 179 deduction for 2025 (ignoring the taxable income limitation)?

In 2025, a sole proprietorship operating a manufacturing business purchased and placed in service qualifying equipment on June 30, 2025, for $500,000. The equipment is eligible for bonus depreciation under Internal Revenue Code Section 168(k) at 60% for 2025, and the taxpayer does not elect out. If the taxpayer elects Section 179 expense of $500,000 under Internal Revenue Code Section 179, how is bonus depreciation applied in the first year?