C is corrent. For 2012, Sec. 179 permits a taxpayer to elect to treat up to $500,000 of the cost of qualifying depreciable personal property as an expense rather than as a capital expenditure. However, the $500,000 maximum is reduced dollar-for-dollar by the cost of qualifying property placed in service during the taxable year that exceeds $2 million. Here, the maximum amount that can be expensed is [$500,000 – ($2,200,000 – $2,000,000)] = $300,000.
A is incorrect because $300,000 may be expensed for 2012.
B is incorrect because $300,000 may be expensed for 2012.
D is incorrect because $300,000 may be expensed for 2012.
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