Straight-Line Depreciation

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Straight-Line Depreciation

A method employed to calculate the decline in the value of income-producing property for the purposes of federal taxation.

Under this method, the annual depreciation deduction that is used to offset the annual income generated by the property is determined by dividing the cost of the property minus its expected salvage value by the number of years of anticipated useful life.

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It may be straight line depreciation or reducing balance; in the end, it is pretty much the same which is, there is a reduction in the value of the asset.
"[w]hile a linear, or straight line depreciation method is most
However, cost recovery for structures (including buildings) would remain unchanged with a 27.5-year straight line depreciation for residential buildings and 39-year straight line depreciation for nonresidential buildings.
179 deduction or bonus depreciation can be recovered using straight line depreciation over a 15-year recovery period (Code Sec.
Personal property has a short recovery period (e.g., 5 or 7 years) and is also eligible for accelerated depreciation (e.g., double declining balance as oppose to straight line depreciation).
Straight line depreciation is obliged for intangible fixed assets.
Some of the best real estate appraisers in the United States were consulted for their opinions regarding the assumptions made in using a straight line depreciation rate of 20/o in projecting the future values of frame residential properties.
Also, the asset's salvage value will be zero, the firm's weighted average cost of capital is k = 10%, the corporate tax rate is 33%, and straight line depreciation over the 20 year economic life of the asset is used by both the firm and the tax authorities.