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Unformatted text preview: Property Depreciation 1 Property Depreciation Jennifer Stacy BUS3060 Fundamentals of Finance and Accounting November 8, 2010 Maureen Steinwall Property Depreciation 2 The definition of Deprecation on the IRS website is an income tax deduction that allows a tax payer to recover the cost or other basis of a certain property. Its an annual allowance for the wear and tear, deterioration, or obsolescence of the property. In most types of tangible property (except land) such as buildings, machinery, vehicles, furniture, and equipment are depreciable. In order for the taxpayer to be allowed a depreciation deduction for a property the property must meet all the following requirements, the taxpayer must own the property. Taxpayers may also depreciate any capital improvements for property the taxpayer leases; a taxpayer must use the property in business or in an income-producing activity. If a taxpayer uses a property for business and for personal purposes, the taxpayer can only deduct depreciation...
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