depreciation Real Estate License Exam Study Guide AgentExamPass.com

Описание: depreciation

loss of value of real property

Depreciation is a loss of value in real property for any of the following reasons: age, economic obsolesce, functional obsolescence or other reasons. There is also appreciation which can result from inflation or improvements. Depreciation can be important for different reasons, for example for appraisal purposes where usually the more-value-the-better because we want deductions. When it comes to depreciation due to age, there is actual age which is the age of the structure and effective age which is actual age accelerated by more rapid deterioration or reversed by improvements which back up the effect of actual age. There are two types of depreciation, curable which can be fixed and incurable which are things that cannot be fixed. Depreciation for tax purposes usually uses a straight-line method based on the cost basis or adjusted cost basis and divides it by the allowable number of years, say 25, and deducts that amount each year until zero is reached. For appraisal, depreciation is more complicated because we want to know the value of the property with including depreciation. Depreciation is the loss of value of real property. Antonyms: appreciation Related Words: depreciation for appraisal purposes, depreciation for tax purposes, curable, incurable

Multiple Choice Question

depreciation
A increase of value of real property
B regulation of pollutants in discharged water
C loss of value of real property
D general lack of public interest in real property

Correct Answer: c

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