Groups of Assets

If you place more than one asset of the same type into service during the year, and the assets are in the same class, with the same recovery period, and use the same depreciation method, you can elect to group the assets into a "general asset account." For example, if you purchase five computers to use in your business during the year, you can create a general asset account for them.

There are new regulations to consider regarding the disposition of an asset in a general asset account. Theses rules must be applied to tax years beginning on or after January 1 2014 and may require an application for a change in accounting method. Although the general asset account can simplify your recordkeeping, it can also cause problems if you sell one, but not all, of the assets in the group before the end of the recovery period. Therefore, be sure to check with your tax advisor if you think you want to use a general asset account for large, relatively expensive assets.

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