Accelerated depreciation allows a firm to deduct more than the actual economic depreciation from its income each year.

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Accelerated depreciation methods, such as double-declining balance or sum-of-years' digits, allow a firm to deduct a larger portion of the asset's cost in the early years of its use, resulting in higher deductions and lower taxable income. This is in contrast to straight-line depreciation, which deducts an equal amount each year. However, over the asset's useful life, the total deductions will be equal to the actual economic depreciation.

Accelerated Depreciation Allows a Firm to Deduct More Than the Actual