Question

How long does it take for these things to be depreciated according to the IRS:

equipment and furniture
electronics
buildings
land
a) 3, 5, 27.5, not depreciated
b) 5, 7, 39, not depreciated
c) 7, 10, 27.5, not depreciated
d) 10, 15, 39, not depreciated

Answer 1

The IRS specifies depreciation durations as 7 years for equipment and furniture, 5 years for electronics, 27.5 years for residential buildings, and 39 years for commercial buildings. Land is not subject to depreciation as it does not have a determinable useful life.

Step-by-step explanation:

Depreciation is an accounting method of allocating the cost of a tangible asset over its useful life. In the context of the Internal Revenue Service (IRS), there are specific durations for different types of assets. According to the IRS:

• Office equipment and furniture are typically depreciated over 7 years.
• Electronics, such as computers and related equipment, are generally depreciated over 5 years.
• Residential buildings are depreciated over 27.5 years.
• Commercial and industrial buildings are depreciated over 39 years.
• Land is not depreciable as it does not wear out, become obsolete, or get used up.

Therefore, the correct answer to the student's question is: a) 3, 5, 27.5, not depreciated