The New Economics of Accelerated Depreciation

Alan J. Auerbach

NBER Working Paper No. 848 (Also Reprint No. r0377)
Issued in June 1983
NBER Program(s):   PE

The Economic Recovery Tax Act of 1981 included the largest business tax cut in U.S. history, embodied in the Accelerated Cost Recovery System. This paper describes in detail the provisions of the new treatment of depreciable property ,and analyzes in a fairly nontechnical way its economic impact. Particular attention is paid to a novel part of ACRS that creates a "safe harbor" for a wide range of sale—leaseback arrangements, effectively permitting the sale of depreciation deductions by investors without taxable income.

(328 K)

(240 K)

Published: Auerbach, Alan J. "The New Economics of Accelerated Depreciation." Boston College Law Review, Vol. 23, No. 5 (September 1982), pp. 1327-1355.

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