global Tax Accelerated Depreciation: Permanent Under the PATH Act? March 14, 2016 Disclaimer This post was published more than two years ago, and some information may now be out of date. We want to help you make the best decisions possible—please connect with your advisor or check out our latest resources for the most current guidance. Accelerated depreciation is a valuable tax break for restaurants and retailers—find out how the PATH Act adjustments impact this tax break. The Protecting Americans from Tax Hikes (PATH) Act makes permanent a number of provisions under the tax code, including the accelerated depreciation tax break. What is accelerated depreciation? Accelerated depreciation is the process of depreciating fixed assets at a quicker rate earlier in their useful lives. Thus the amount of depreciation in the earlier years of an asset’s life is greater than the straight-line amount, but will be less in the later years. Taxpayers using this method will benefit from a reduction of taxable income early in the life of an asset. What does the PATH Act extend? The PATH Act has made permanent the ability to apply a shortened recovery period of 15 years (as opposed to 39 years) to qualified leasehold improvement, restaurant and retail-improvement property. Download our eBook, “2015 PATH Act: What All Taxpayers Need to Know” for helpful planning tips when it comes to applying accelerated depreciation to your property.
