1. LO.1 Discuss whether property that is classified as personal use is subject to costrecovery.
2. LO.1 Discuss the difference between personal property and personal useproperty.
3. LO.1 Discuss whether land improvements are eligible for cost recovery.
4. LO.2 At the beginning of the current year, Henry purchased a ski resort for $10million.Henry does not own the land on which the resort is located. The Federal governmentowns the land, and Henry has the right to operate the resort on the land pursuant toSpecial Use Permits, which are terminable at will by the Federal government, andTerm Special Use Permits, which allow the land to be used for a fixed number ofyears.In preparing the income tax return for the current year, Henry properly allocated $2million of the purchase price to the costs of constructing mountain roads, slopes, andtrails. Since the acquisition, Henry has spent an additional $1 million on maintainingthe mountain roads, slopes, and trails. Identify the relevant tax issues for Henry.
5. LO.2 Discuss whether the date an asset is placed in service is important indetermining whether the mid-quarter convention applies for personalty.
6. LO.2 Identify the three factors reflected in the MACRS tables when the amount ofcost recovery is determined.
7. LO.2 Discuss the computation of cost recovery in the year an asset is placed inservice when the mid-quarter convention is being used.8. LO.2 Discuss what property qualifies for additional first-year depreciation.9. LO.2 Discuss the computation of cost recovery in the year of sale of an assetwhen the mid-quarter convention is being used.10. LO.2 Discuss the definition of residential rental real estate.11. LO.2 Robert purchased and placed in service $100,000 of seven-year class