Although firms can elect to use straight-line depreciation for their external financial reporting, the MACRS depreciation schedules have exceeded in use over other depreciation methods for tax purposes.

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MACRS stands for Modified Accelerated Cost Recovery System, which is a tax depreciation method used by the IRS in the United States. MACRS is a faster depreciation method compared to straight-line and is often preferred by firms for tax purposes as it allows for more significant tax deductions in the earlier years of owning an asset. While firms can choose to use straight-line for their financial reporting, MACRS is the more common method used for tax purposes.

Although Firms Can Elect to Use Straight-Line Depreciation for Their