There are two situations in which a taxpayer may not want to use accelerated depreciation.  First, if the taxpayer is experiencing losses or low current period incomes, he or she may wish to defer more of the deduction to later periods in anticipation of higher incomes.  Second, the accelerated portion of the depreciation (i.e., accelerated due to method and class life) is subject to the alternative minimum tax.  Thus, a taxpayer in or near an alternative minimum tax situation may find that using the accelerated MACRS depreciation is more costly.

Taxpayers are allowed to elect straight-line depreciation under MACRS.  Depreciation can be calculated over the class life of the asset or the Alternate Depreciation System life.  The ADS life is used to calculate the alternative minimum tax depreciation and is used by taxpayers desiring to avoid the alternative minimum tax.