@Carl wrote:
This is one of many reasons why I try to keep my depreciation as low as I legally can. Many folks are of the incorrect impression that depreciation is a permanent deduction. It is not.
You need to fully understand the time value of money to appreciate this form of cost recovery system. The amount of income tax saved as a result of depreciation deductions can immediately be invested.
The accumulated deductions may be subject to recapture, but any tax due thereon will almost certainly be paid back in cheaper dollars than when the deductions were taken.
