Prepare a depreciation schedule for the rental equipment, Advanced Statistics

Sam Tyler, a single taxpayer, social security number 111-44-1111, bought Rental Equipment on 04/01/2010. He paid $400,000 including all closing and delivery costs. In the current year, he collected rents of $27000 and paid tangible taxes of $7,000, insurance $3700, maintenance $12000, repairs $1700, Note interest $11500.

On June 1, of the current year, Sam sold the rental property for $465,000. Sam paid the closing costs and commissions of $15,000. The buyer put a $65,000 deposit down on the property and signs a promissory note for $400,000 with interest payable at 5% annually.

Sam receives $10667 of interest from the buyer in current year and $50000. in principal payments on the seller financed loan. Assume the buyer is not a related party and that Sam does not participate in this equipment rental activity.

  1. Prepare a depreciation schedule for the rental equipment through the current year (2012) assuming 50% bonus depreciation was available in 2010.  Assume equipment has a 5 year life. This schedule may be an Excel spreadsheet and usually includes asset costs, date acquired, depreciation expense allowed each year and accumulated deprecation to date. You must use the MACRS tables containing percentages to use in your Excel spreadsheet for calculating the depreciation. Half year convention will apply to year of sale. It would also tie to the fixed asset section of a balance sheet if one existed. HINT: Accumulated Depreciation at 12/31/11 is $304,000
  2. Prepare Schedule B, E (You will use schedule E since the actual schedule required for Tangible property rents would simply be a manually prepared schedule identical to schedule E.)  and  form 4562 for the taxpayer's current year rental activity.
  3. Prepare forms 4797, 6252 and schedule D for the sale of the property. Prepare these forms in the order shown here. You will use part III of form 4797. Read the instructions for 4797 Line 32 will be blank with installment sale or gain will get reported twice. Filled in forms 4797 and 6252 may be found in your text see Appendix B for page numbers. See pages 13-25 and 11-29 in your text for filled out forms 4797 and 6252 this may help you.
  4. Write a brief memo explaining to the taxpayer the character of all of the income, gains and losses and applicable tax rates from this activity and transaction in the current year. Include any planning options they have for the future years taxes from this transaction. Bullet points are fine.
Posted Date: 7/27/2013 6:44:24 AM | Location : United States







Related Discussions:- Prepare a depreciation schedule for the rental equipment, Assignment Help, Ask Question on Prepare a depreciation schedule for the rental equipment, Get Answer, Expert's Help, Prepare a depreciation schedule for the rental equipment Discussions

Write discussion on Prepare a depreciation schedule for the rental equipment
Your posts are moderated
Related Questions
Profile plots  is a technique of representing the multivariate data graphically. Each of the observation is represented by a diagram comprising of a sequence of equispaced vertical

Population averaged models are the models for kind of clustered data in which the marginal expectation of response variable is the main focus of interest. An alternative approach

Case-control study : The traditional case-control study is the common research design in the epidemiology where the exposures to risk factors for cases (individuals getting the dis

The Null Hypothesis - H0:  There is no heteroscedasticity i.e. β 1 = 0 The Alternative Hypothesis - H1:  There is heteroscedasticity i.e. β 1 0 Reject H0 if |t | > t = 1.96

Different approaches to the study of early indian history

Formal graphical representation of the "causal diagrams" or the "path diagrams" where the  relationships are directed but acyclic (that is no feedback relations allowed). Plays an

Ordination is the procedure of reducing the dimensionality (that is the number of variables) of multivariate data by deriving the small number of new variables which contain much

1. You are interested in investigating if being above or below the median income (medloinc) impacts ACT means (act94) for schools. Complete the necessary steps to examine univariat

Johnson-Neyman technique:  The technique which can be used in the situations where analysis of the covariance is not valid because of the heterogeneity of slopes. With this method

Cauchy distribution : The probability distribution, f (x), can be given as follows   where α is the position of the parameter (median) and the beta β a scale parameter. Moments