Dictionary of Business Terms: component depreciation
component depreciation
an effort to depreciate a property based on the lives of individual assets within it. For example, a building has electrical components and plumbing components that may be assigned a 20-year life, a roof with 15, and a foundation with a 50-year life. Use has diminished because the 1981 tax act and subsequent acts generally required composite depreciation.
Dictionary of Real Estate Terms: component depreciation
component depreciation
dividing real estate improvements into various parts such as the roof, plumbing, electrical system, and shell, then depreciating each component separately for tax purposes. Eliminated by the 1981 Tax Act, for acquisitions after 1980.
