The rules for what can or has to be depreciated are promulgated by the Internal Revenue Service. The following is an explanation from the IRS about the general rule on depreciation:
"In general, if business property is expected to last more than one year, the entire cost cannot be deducted as a business expense in the year you place it into service. It must be depreciated over the property’s useful life (as defined by the Internal Revenue Code). Most types of tangible property (except land) such as buildings, machinery, vehicles, furniture, and equipment are depreciable. Likewise, certain intangible properties such as patents, copyrights, and computer software are depreciable.
"You can elect to recover all or part of the cost of certain qualifying property (not buildings), up to a limit, by deducting it in the year you place the property in service. This is the section 179 deduction.
FS-2006-27, Depreciation Reminders
Publication 946, How to Depreciate Property "
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