Asset Depreciation Range System (ADR)

Range of depreciable lives allowed by the Internal Revenue Service for particular classes of depreciable assets. The ADR system was replaced when the Economic Recovery Tax Act of 1981 (ERTA) introduced the Accelerated Cost Recovery System (ACRS) but was revived with modifications of ACRS under the Tax Reform Act of 1986. The ADR system assigns an upper and lower limit to the estimated useful lives of asset classes. ACRS classes are based on the mid-points of these ranges. Under the alternative depreciation system, taxpayers may elect Straight Line Depreciation over the applicable ADR-class life.