which of the following statements about residential rental property are TRUE? The property may be depreciated...

which of the following statements about residential rental property are TRUE? The property may be depreciated using the ___________

a. ADS for a period of 30 years only by electing to in the first year the property is placed into service

b. General Depreciation System for the period of 30 years

c. GDS for a period of 40 years

Expert Solution

1. Depreciation gets initiated as soon as the property gets placed into the service or gets available to use as a rental source of income.

2. In general, we have to use GDS (General Depreciation System) to depreciate most of the properties placed in service.

3. ADS (Alternate Depreciation System) is only used in following 4 cases:

a) Property has a tax-exempt use.

b) Property is used primarliy for farming activities.

c) Property has been financed by tax- exempt bonds.

d) Property has % or less of qualified business use.

4. In question under consideration, no such characteristics of ADS are visible, therefore, we will apply GDS to depreciate the residential rental property. (Option A is incorrect)

5. The common time frame for depreciating residential rental property is 27.5 years.

So, the correct answer is Option B (rounded off to 30 years). Therefore, the answer cannot be GDS over 40 years (Option C is incorrect)

6. Conclusion: The residential rental property is depreciated using GDS (General Depreciation System) for 30 years period- Option B is correct.

jeff jeffy answered 1 year ago

Residential real estate was purchased in 2014 for $375,000, held as rental property, and depreciated straight-line....

Residential real estate was purchased in 2014 for $375,000, held as rental property, and depreciated straight-line. Assume the land cost was $75,000 and the building cost was $300,000. Depreciation totaled $34,089. The building and land were sold on June 10, 2017, for $690,000 total. What is the tax status of the property, the nature of the gain from the disposition, and is any of it § 1250 depreciation recapture gain or unrecaptured § 1250 gain?

Which of the following statements is true about diamagnetic materials? Diamagnetism is a property that appears...

Which of the following statements is true about diamagnetic materials? Diamagnetism is a property that appears in all materials, but that in paramagnetic and ferromagnetic substances, the diamagnetic effect is overcome by other forms of magnetism. Diamagnetic materials, such as the gadolinium transition metal, are particularly useful as contrast agents in diagnostic procedures such as MRI. A compound with twelve diamagnetic electrons and one paramagnetic electron is strongly diamagnetic and only weakly paramagnetic. Diamagnetic materials form internal and induced magnetic...

Which of the following statements about correlation are true?

4. Correlation basics Which of the following statements about correlation are true? Check all that apply Correlation is a numerical value between 1.1 and 2. The sign of the correlation indicates the strength or consistency of the linear relationship between two variables. A negative correlation means that two variables tend to change in opposite directions The correlation indicates the strength and the direction of the linear relationship between two variables If the correlation between two variables is 0, there is no clear linear relationship between the...

Which of the following statements about genetics is TRUE?

Which of the following statements about genetics is TRUE? a. A mutation is any change in DNA that is harmful to an organism. b. Genetic disorders are always caused by the inheritance of recessive alleles. c. The red queen hypothesis proposes that asexual reproduction evolved in organisms to increase genetic variation, and therefore, improve resilience in ever-changing environments. d. Natural selection acts directly on the phenotype and indirectly on the genotype.

Jenny constructed a building for use as a residential rental property. The cost of the building...

Jenny constructed a building for use as a residential rental property. The cost of the building was $82,488, and it was placed in service on August 1, 1997. The building has a 27.5-year MACRS life. What is the amount of depreciation on the building for 2019 for tax purposes?

Which of the following statements are true? There may be more than one true statement. A....

Which of the following statements are true? There may be more than one true statement. A. Any linear combination of vectors can always be written in the form Ax for a suitable matrix A and vector x. B. Every matrix equation Ax=b corresponds to a vector equation with the same solution set. C. If the echelon form of the augmented matrix [A | b][A | b] has a leading entry in every row, then the equation Ax=b is inconsistent. D....

Which of the following statements is true? Note that more than one of the statements may...

Which of the following statements is true? Note that more than one of the statements may be true. a. Every relation that is in 3NF is in 2NF. b. A relation that is in 2NF, and that has a non-primary-key attribute that is functionally dependent on another non-primary-key attribute is not in 3NF. c. A relation that is in 2NF, and that has a non-primary-key attribute that is transitively functionally dependent on the primary key is not in 3NF. Which...

Which of the following statements about reducing sugars are true?

Which of the following statements about reducing sugars are true?The oxidation of a reducing sugar forms a carboxylic acid sugar.A reducing sugar will not react with the Cu^2+ in Benedict's reagent. D-Mannose (an aldose) is a reducing sugar.Reducing sugars contain ketone groups instead of aldehyde groups.A disaccharide with its anomeric carbons joined by the glycosidic linkage cannot be a reducing sugar.

Which of the following statements about financial planning is not true?

Which of the following statements about financial planning is not true? Financial planning process is a series of decisions on how much money you will need at some future time to meet your goals and how you will obtain the money To meet your goals, you must balance the equation: Financial goal = present savings (FVIF n, k) + annual savings (FVIFA n, k) Once you have a financial plan in place, you need to review it only every few...

Which of the following statements is NOT true about the opinion of the auditor on the...

Which of the following statements is NOT true about the opinion of the auditor on the financial statements? Select one: a. The auditor is responsible for the detection and prevention of frauds and errors in financial statements. b. The auditor should examine whether recognized accounting principles have been consistently applied in preparation of the financial statements. c. The auditor should express an opinion on the financial statements. d. The opinion is not guarantee of the future economic viability of the...

Question