Accelerated depreciation
Definition
Any method of depreciation used by businesses for accounting or tax purposes that allows greater deductions in the earlier years of the life of a company asset, as opposed to the straight-line depreciation method.
Accelerated depreciation can be a useful tax incentive because it permits companies to defer payment of corporate income taxes by reducing the amount of taxable income each year. This in turn results in increased cash flow, encouraging companies to purchase more assets.
Definition from Nolo’s Plain-English Law Dictionary
A method of deducting the cost of a business asset more rapidly than by using straight-line depreciation. There are several accelerated depreciation methods, often referred to as MACRS (modified accelerated cost recovery system).
Definition provided by Nolo’s Plain-English Law Dictionary.
August 19, 2010, 5:10 pm
