What Property Can Be Depreciated?

Terms you may need to know (see Glossary):

Adjusted basis

Basis Commuting Disposition Fair market value (FMV) Intangible property Listed property Placed in service Tangible property Term interest Useful life

You can depreciate most types of tangible property (except land), such as buildings, machinery, vehicles, furniture, and equipment. You can also depreciate certain intangible property, such as patents, copyrights, and computer software.

To be depreciable, the property must meet all the following requirements.

• It must be property you own.

• It must be used in your business or income-producing activity.

• It must have a determinable useful life.

• It must be expected to last more than 1 year.

The following discussions provide information about these requirements.