What is MACRS depreciation?

Modified Accelerated Cost Recovery System is the IRS standard depreciation method. Uses double-declining balance switching to straight-line, with specific recovery periods by asset class.

What is the half-year convention?

Under the half-year convention, all assets placed in service during the year are treated as placed in service at the mid-point. Assets must be in service before October 1 to avoid the mid-quarter convention.

How do I depreciate a rental property?

Residential rental property: 27.5 years straight-line. Commercial property: 39 years straight-line. Land is never depreciable. Only the building/improvement cost is depreciable.

What assets qualify for 5-year MACRS?

Automobiles, light trucks, computers, peripheral equipment, certain solar/wind energy property, and similar assets. 7-year property includes most office furniture, fixtures, and equipment not in other classes.

How does section 179 interact with MACRS?

Section 179 allows immediate expensing of qualifying assets (up to $1.22M in 2024), bypassing MACRS entirely. Bonus depreciation (60% in 2024) allows additional first-year deduction on remaining basis.

US MACRS Depreciation Calculator

Calculate MACRS depreciation for business assets. Recovery periods: 5-year (vehicles, computers), 7-year (office equipment, furniture), 15-year (land improvements), 27.5-year (residential rental), 39-year (nonresidential).

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate MACRS depreciation for business assets. Recovery periods: 5-year (vehicles, computers), 7-year (office equipment, furniture), 15-year (land improvements), 27.5-year (residential rental), 39-year (nonresidential). Use the macrs depreciation result to inform your calculation.

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Frequently Asked Questions

What is MACRS depreciation?

What is the half-year convention?

How do I depreciate a rental property?

What assets qualify for 5-year MACRS?

How does section 179 interact with MACRS?