When your company purchases a fixed asset with an estimated lifetime exceeding one year, you cannot deduct the entire cost in the year of purchase. Rather, you must depreciate the asset by expensing a ...

Assets like equipment, vehicles and furniture lose value as they age. Parts wear out and pieces break, eventually requiring repair or replacement. Depreciation helps companies account for the ...

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Accounting for depreciation can be a helpful accounting trick when businesses make a major purchase. Depreciation has several different meanings, depending on the context in which it’s being used.

Depreciation helps companies manage taxes and asset value by reducing the recorded value of physical assets over time. Different methods of depreciation allow for varying impact on financial ...

Understanding the differences between depreciation and amortization is essential for managing assets and financial reporting. Both are methods of allocating the cost of an asset over its useful life, ...

Depreciation expense can be a big portion of a company’s total expense. And since expenses decrease income, it affects the overall value of a company. Understanding what it is and the methods can help ...

Income is perhaps the single most important measurement of a business's success in running its operations, but it is inaccurate and misleading unless the business records revenues and expenses in the ...

The Treasury has issued final regulations (Treasury Decision 9314) explaining how to depreciate modified accelerated cost recovery system (MACRS) property that has been acquired in a section 1031 like ...

Accumulated depreciation is the sum of an asset’s depreciation expense. It’s calculated from the start of its use to a specific date. It’s also a contra-asset account. That means it decreases the ...

Depreciation recapture is the process by which the IRS reclaims tax benefits previously obtained through depreciation when an investor sells a depreciable asset for more than its depreciated value.