MACRS Depreciation Calculator

Modified Accelerated Cost Recovery System is the standard US tax depreciation method required by the IRS. It assigns assets to property classes with predetermined depreciation schedules and depreciates to zero with no salvage value.

MACRS uses recovery periods: 3-year (tools), 5-year (vehicles, computers), 7-year (furniture), 10-year (boats), 15-year (land improvements), 20-year (farm buildings), 27.5-year (residential rental), 39-year (commercial property).

The half-year convention assumes assets are placed in service at the midpoint of the year, regardless of actual date. First and last year depreciation is halved. Most personal property uses this convention.

No. Unlike straight-line and declining balance methods, MACRS always depreciates assets to zero. The IRS does not consider salvage value in MACRS calculations.

Section 179 allows businesses to deduct the full cost of qualifying assets in the year of purchase rather than depreciating over time. The 2025 limit is $1,250,000. This is separate from MACRS but can be used alongside it.

Bonus depreciation allows an additional first-year deduction beyond regular MACRS. The rate is being phased down from 100%. It applies to new and used qualifying property. Check current rates as they change annually.