09/06/2022

Understanding How Depreciation Works:

Here’s the big picture

Depreciation can be complicated. Fortunately, it is simpler than it used to be.

There are still many complex rules that can prove mind-numbing for anyone but a tax professional. Is the asset 3-year property, 5-year property, 7-year property or maybe as much as 39-year property? How do you understand those unusual descriptions of depreciation methods, like straight-line and double-declining-balance?

Then, there are rules stating, if you use a declining-balance method, you can switch to the straight-line method at the optimal time. How do you know when the optimal time has arrived?

Please select this link to read the complete article from OSAP Member VonLehman CPA & Advisory Firm.