Question

Which of the following statements is TRUE regarding recapture for listed property under §280F? No depreciation is claimed for the item for the year in which recapture is made. The year following the year of recapture, use the general depreciation system (GDS), unless business use of the item drops to 50% or less. The year following the year of recapture, use the straight-line (SL) method in the general depreciation system (GDS), as long as the business use of the item is 50% or less. The year of the recapture and in all subsequent years of depreciation, use the straight-line (SL) method over the alternative depreciation system (ADS) recovery period. Mark for follow up ________________________________________.

Answer 1

To be eligible to use accelerated or bonus depreciation on a business aircraft, generally requires that the aircraft be used at least 50 Percent for business purposes .

Under § 280F(b), an aircraft that fails the 50 Percent Test in any year is required to use the Alternative Depreciation System in that year and all future years, and it may not

use MACRS or bonus depreciation. No depreciation is required in the year of recaptured if there is a loss. Repture for the listed property is exempted if leased to related

party. It is assumed that no leased to related party. Based on the following correction option are marked:

√

No depreciation is claimed for the item for the year in which recapture is made.

√

The year following the year of recapture, use the general depreciation system (GDS), unless business use of the item drops to 50% or less.

√

The year following the year of recapture, use the straight-line (SL) method in the general depreciation system (GDS), as long as the business use of the item is 50% or less.

The year of the recapture and in all subsequent years of depreciation, use the straight-line (SL) method over the alternative depreciation system (ADS) recovery period.