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To allocate the purchase cost of an asset over its life.


The gradual reduction of an asset's value. It is an expense, but because it is non-cash, it is often effectively a tax write-off; that is, a person or company usually may reduce his/her/its taxable income by the amount of the depreciation on the asset. Because there are many different ways to account depreciation, it often bears only a rough resemblance to the asset's useful life. This may further benefit the company as they may continue to use the asset tax-free after its value has technically depreciated to nothing. See also: Amortization.


To reduce the value of a long-term tangible asset.
References in periodicals archive ?
If either the recovery period or the depreciation method for the replacement property is the same as for the relinquished property, then the period or the method that is the same is used to depreciate the replacement property (Treas.
said: "Big cars tend to depreciate faster than small cars.
Volvo and Mercedes depreciate least, which means whether buyers purchase these new or after a couple of years.
He noted that China did not depreciate the yuan during the 1997 Asian financial turmoil and that helped stabilize the regional economic situation from getting worsen.
This is '7-year property' that the owner can depreciate over seven years at 200 percent declining balance.
While referenced to a basket of currencies, it is normal for USD/RMB exchange rate to either appreciate or depreciate, and to float bi-directionally in the future.
Thus, in our example, the taxpayer could depreciate the exchanged basis for the building over the remaining 33 years on the straight-line method.
report revealing that some new cars depreciate up to 75 per cent in their first three years?
If a company buys $390,000 worth of equipment this year, for example, it can take a $100,000 deduction and depreciate the other $290,000.
8 S 5-dr is predicted to depreciate by pounds 8,880 over three years/ 60,000 miles, against pounds 10,435 by the more expensive Vauxhall Vectra 1.
Money that should have flowed abroad, causing the yen to depreciate, was squandered on the building of meaningless bridges and roads to nowhere.
ALL CARS depreciate, but some more quickly than others.