Financial Glossary
Accelerated Depreciation
Accelerated depreciation is a class of depreciation methods that write off a larger share of an asset's cost in the first years of its useful life and smaller amounts later, rather than spreading the cost evenly. Common approaches include the declining-balance and double-declining-balance methods, as well as tax provisions like MACRS and bonus depreciation. The total amount deducted over the asset's life is the same as straight-line depreciation; only the timing changes.
Problem & Application
For STR operators, campground owners, and real estate investors who buy furnishings, vehicles, hookups, or improvements, front-loading deductions can reduce taxable income in the years when capital is tightest. Pairing accelerated methods with a cost segregation study often unlocks meaningful early-year tax savings on a property. The trade-off is smaller deductions later, so it should fit your projected income, not just this year's bill.
In Short
Accelerated depreciation is a timing lever: it pulls deductions forward to match real-world cash needs without changing the lifetime total. Choosing it deliberately, asset by asset, is where the value lies.