ACCELERATED DEPRECIATION depreciation methods, chosen for income tax or accounting purposes, that offer greater deductions in early years. The straight-line method, rather than accelerated depreciation, generally applies to buildings bought after 1986. See MACRS. Example: One method of accelerated depreciation is the double declining balance method (DDB). If straight-line deductions equal 5% of depreciable basis, DDB allows a deduction of 10% (200% of 5%), but applied to the undepreciated basis. Thus the deductions decline each year (Figure 2).
ACCELERATION CLAUSE a loan provision giving the lender the right to declare the entire amount immediately due and payable upon the violation of a specific loan provision, such as failure to make payments on time. Example: Collins sells her house to Baker, who assumes the existing 8% interest rate mortgage. They do not notify the lender of the sale. Clause 17 in the mortgage states that the full principal accelerates unless the lender approves of the sale. Collins must now pay the balance of the principal.