Depreciation and amortization are processes used to spread the cost of business assets over a number of years, with part of the total deducted in each year. Each year, you can deduct part of the cost until it’s fully recovered.  Depreciation is used to recover the cost of tangible property, like machinery, equipment, furniture, buildings, and improvements. Amortization is used to recover the cost of intangible property like patents, trademarks, and trade secrets. The amortization process is usually spread over 15 years.