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What is the difference between the alternative and regular tax depreciation system

Depreciation Accounting methods
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Bill Robinson, CPA
Regular tax and Alternative Minimum Tax (AMT) are two parallel tax systems. Depreciation is an area where the two systems diverge. The object of AMT was originally to insure the very rich paid some baseline of tax by making adjustments to certain incentives and deductions granted by statute in the regular tax system. In the case of depreciation every class life (assigned to a type of property - Example Real Estate, Furniture and Fixtures, Equipment) is assigned a recovery period for depreciation for regular tax that is shorted than the recovery period for AMT. So the taxpayer calculates depreciation using say a 5 year life for regular tax and a 7 year life for AMT. In addition, the AMT method of depreciation may be different from the regular tax system. In the case of shorter lived property. regular depreciation is calculated using the 200% DDB and AMT is 150% DDB (Double declining balance). Very broad question.
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