Explore commonly used personal finance terms.
Accelerated cost recovery is an accounting method allowing faster depreciation of assets, which provides businesses with tax deductions earlier in the asset’s life. This practice reduces taxable income sooner, thereby freeing up cash flow for reinvestment. Accelerated cost recovery is useful for companies investing in capital-intensive equipment or property, as it helps manage tax liabilities effectively. By expediting cost recovery, businesses gain immediate financial relief, supporting growth and strategic investments.
