McGraw-Hill's Taxation of Individuals and Business Entities 3rd Edition by Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

Exercise 44

On November 10 of year 1 Javier purchased a building, including the land it was on, to assemble his new equipment.The total cost of the purchase was $1,200,000; $300,000 was allocated to the basis of the land and the remaining $900,000 was allocated to the basis of the building.
Using MACRS, what is Javier's depreciation expense on the building for years 1 through 3? What would be the year 3 depreciation expense if the building was sold on August 1 of year 3? Answer the question in part (a), except assume the building was purchased and placed in service on March 3 instead of November 10.Answer the question in part (a), except assume that the building is residential property.What would be the depreciation for 2011, 2012, and 2013 if the property were nonresidential property purchased and placed in service November 10, 1994 (assume the same original basis)?