Depreciation Expense is an accounting term used to describe the systematic allocation of the cost of a tangible asset over its useful life. This expense allows companies to spread out the cost of an asset and generate tax deductions on it over several years. In other words, it’s a portion of your total machinery, equipment or building costs that you can use to lower your taxable income! So don’t miss out – with depreciation expense, you can put more money back in your pocket.