Land does not have a defined useful life, making it nearly impossible to account for depreciation. Its value may either rise or fall over time, depending on different factors. For instance, a real estate boom can push up land prices, while an environmental catastrophe can decrease values. The assets on land, like buildings, qualify for depreciation.

Even though land cannot be depreciated, some improvements you make have a definite life and will count as depreciation items. Examples of land improvements include paving a driveway, fencing, outdoor lighting, or even filling a wasteland with soil to make it usable.

You may also write down the value when there is evidence of degradation by natural or unnatural causes. For example, an earthquake hits and devastates an area, or mining activity that completely exhausts resources.