Finance: What is the Accelerated Cost Recovery System (ACRS)?

College and CareerPersonal Finance
CoursesFinance Concepts
FinanceFinance Definitions
Financial Responsibility
Personal Finance
Finance and EconomicsTerms and Concepts
LanguageEnglish Language
Life SkillsFinance Definitions
Personal Finance
SubjectsFinance and Economics
Terms and ConceptsBonds
Regulations
Stocks
Trading

Transcript

00:25

part as economic stimulus or you know prunes to the

00:29

American economic digestive system after the country suffered through the

00:33

financially crushing presidency of Comrade Jimmy Carter Well the rest

00:38

laws classified the speed at which taxpayers could depreciate property

00:42

they owned essentially allowing for the speed of depreciation to

00:45

be well accelerated thus saving near term tax liabilities and

00:50

at least notionally leaving more cash sloshing around the economy

00:53

for corporations to spend on upgrades new hires market share

00:57

increases and you know stuff like that Rather than ending

01:00

up as dead end tax dollars you know I'm just

01:03

going back to the man Well there were eight speeds

01:05

of depreciation more or less that we're allowed and they

01:08

range from three to nineteen years Meaning that for say

01:11

a laptop It could be depreciated to be basically worthless

01:15

in three years for a warehouse storage building It might

01:18

take nineteen years And while most warehouses last a lot

01:21

more than nineteen years right So you think about it

01:24

You got all that tax depreciation upfront Kind of free

01:26

tax money to play with early in the years by

01:29

depreciating things aggressively So why is this even noteworthy Like

01:33

why are we doing a video on this thing Well

01:35

before the accounting required a lot of guesswork Like how

01:39

long do you think this computer will look Less There's

01:43

no expiration date on the bottom So what do we

01:45

do Yeah And this was at a time when the

01:47

IBM PC was just getting out there and Apple was

01:51

well really kind of a fledgling baby company So nobody

01:54

really knew how long the computer would in fact last

01:57

and be useful Basic We just took a lot of

02:00

the guesswork out of depreciation speeds and accounting so Yeah

02:04

thanks there Ronnie for keeping Uncle Sam on a tight 00:02:07.13 --> [endTime] leash Yeah