accelerated cost recovery system

Accelerated cost recovery system (ACRS)

Schedule of depreciation rates allowed for tax purposes.

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Accelerated Cost Recovery System (ACRS)

An accounting technique for calculating the depreciation of tangible assets on the basis of the estimated-life classifications into which the assets are placed. ACRS was initiated by the Economic Recovery Act of 1981. The goal was to make investments more profitable by sheltering large amounts of income from taxation during the early years of an asset's life. The initial law established classifications of 3, 5, 10, and 15 years; these classifications were subsequently modified in order to reduce depreciation and increase the government's tax revenues. The classification into which an asset is placed determines the percentage of the cost potentially recoverable in each year. See also Modified Accelerated Cost Recovery System.

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Accelerated Cost Recovery System

An accounting technique formerly used in the United States to tax a tangible asset based upon its estimated depreciation. The estimated depreciation bore only a rough relationship to an asset's actual life, and was designed to decrease the taxation in the early years of an asset's ownership. ACRS was instituted by the Economic Recovery Act of 1981 and amended in 1986 to create the Modified Accelerated Cost Recovery System. See also: Absolute Physical Life.

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accelerated cost recovery system (ACRS)

A method of tax accounting in which the IRS simplified the rules for depreciation of property.It has been replaced by the modified accelerated cost recovery system (MACRS),but you will still encounter references to ACRS.

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Accelerated Cost Recovery System (ACRS)

The system of depreciation mainly used for property placed in service after 1980 and before 1987. ACRS is also used for certain property placed in service after 1986 that is acquired from a related party who used the property before 1987. See Modified Accelerated Cost Recovery System (MACRS) for property placed in service after 1986.