Depreciable asset is generally an asset used for generating income or profit and has a useful life of more than a year and gradually reduces in value over time. It is a type of physical asset that is capable of depreciation treatment under tax laws in accordance with the Internal Revenue Service rules.
Under Section 167 of the Internal Revenue Code, a taxpayer is eligible to claim compensation for loss in the value of a depreciable asset.
[Last updated in December of 2021 by the Wex Definitions Team]