General Asset Accounts—What You Need to Know

Posted on 06.22.12

In an unexpected addition to the December 2011 “repairs vs. capitalization” temporary regulations, the IRS revised pre-existing rules that provide a method of grouping assets for depreciation purposes – the general asset account (GAA). GAAs provide a method for businesses to simplify the way in which they account for the MACRS depreciation of multiple assets. GAAs allow businesses to depreciate multiple like-assets it purchases as one asset (for example, an apartment complex owner that buys 200 refrigerators in 2012 for $750 each can depreciate its purchases as one asset costing a total of $150,000, rather than tracking depreciation for each individual refrigerator). General Asset Accounts -- What You Need to Know