Calculate the depreciation amount for the current tax year and list the table used.

A real estate professional is preparing a depreciation schedule to complete his tax return. He owns a residential property that he rents. The list of depreciable assets are shown below.

Asset

Initial Basis/Cost

Acquisition Date

Residential Real Estate Asset

$125,000

2/1/2000

Furniture

$5,000

1/15/2013

Refrigerator

$200

6/15/2012

Microwave

$50

7/1/2013

Carpet

$1,000

8/2/2010

Fences

$2,000

2/1/2000

Requirements:

Analyze the information above. Modify the attached spreadsheet to address each of the numbered requirements. In the appropriate areas:

  1. List the Asset Class.
  2. Calculate the depreciation amount for the current tax year and list the table used.
  3. Cite the information source from which you answered #1 and #2 (IRS publication, textbook, website, etc.).

Clearly identify the requirement being addressed. Show all calculations within the cells of the spreadsheet. This means that you must use formulas and links so that your thought process can be examined. Make good use of comments to convey your thought process as well. No hard coding of solutions is permitted.

Review the grading rubric to understand how you will be graded on this assignment. Reach out to your instructor if you have questions about the assignment.

Note: If IRS Publication 527 is used, apply the MACRS GDS system instead of the MACRS ADS system

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