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Tax treatment for Sections 1245 & 1231 property

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Secs. 1245 and 1231. The LaPoint Corporation placed in service $350,000 of equipment (7-year recovery property) on June 3, 2008 and elected to expense $250,000 as Sec. 179 expense. LaPont sold the equipment for $150,000 on November 22, 2009.

Determine the following:

a. Depreciation allowed in 2008 if the corporation wants to maximize total deductions.
b. Depreciation allowed during 2009.
c. Amount of gain or loss and character.

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Solution Summary

The solution provides a step-by-step explanation that determines the depreciation and amount of gain or loss and character for The Lapoint Corporation.

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