What Does Accelerated Depreciation Mean?

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What does Accelerated Depreciation mean? Read on to discover the definition & meaning of the term Accelerated Depreciation - to help you better understand the language used in insurance policies.

Accelerated Depreciation

Accelerated Depreciation

Accelerated depreciation is the method by which higher amounts of depreciation are documented at the beginning of the life of the asset and lower amounts are documented towards the end of the life cycle. The main goal of accelerated depreciation is to lawfully defer taxes for the purpose of financial growth. For example, accelerated depreciation occurs when a vehicle's value reduces after being damaged during an accident. Even if a vehicle is fully repaired after an accident, its trade value will typically decrease.

We hope the you have a better understanding of the meaning of Accelerated Depreciation.

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