Depreciation Calculator 2025
Calculate your MACRS depreciation schedule with bonus depreciation and Section 179 expensing. See your full year-by-year schedule instantly.
2,150+
Schedules Generated
IRS Pub 946
Official MACRS Tables
6 Classes
Asset Recovery Periods
“Saved me an hour of manually computing my depreciation schedule.”
-- Sarah T., Small Business Owner
Depreciation Calculator
MACRS schedules, bonus depreciation & Section 179
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2025 limit: $2,500,000 (phases out above $4,000,000 total assets)
Disclaimer: This calculator provides estimates based on IRS Publication 946 MACRS tables for educational purposes only. Actual depreciation depends on your specific circumstances, asset classification, and applicable conventions. Consult with a qualified CPA for personalized tax planning advice.
What This Calculator Shows You
MACRS Schedules
Official IRS Pub 946 depreciation percentages for all 6 asset classes.
Bonus Depreciation
100% bonus depreciation permanently restored by the OBBBA for 2025 and beyond.
Section 179
Model the Section 179 immediate expensing election with current-year limits.
Full Schedule
Year-by-year depreciation table with running totals and remaining basis.
Bonus Depreciation Timeline
The One Big Beautiful Bill Act (OBBBA, July 2025) permanently restored 100% bonus depreciation for property placed in service after January 19, 2025.
How MACRS Depreciation Works
What is MACRS?
MACRS (Modified Accelerated Cost Recovery System) is the tax depreciation system required by the IRS for most business assets. Instead of deducting the full cost of an asset in the year you buy it, MACRS spreads the deduction over a “recovery period” ranging from 3 to 39 years depending on the type of asset.
Asset Classes and Recovery Periods
- 3-Year Property: Tractor units, racehorses over 2 years old, rent-to-own property
- 5-Year Property: Vehicles, computers, office equipment, appliances, research equipment
- 7-Year Property: Office furniture, fixtures, agricultural machinery, railroad track
- 15-Year Property: Land improvements (fences, roads, bridges, parking lots, landscaping)
- 27.5-Year Property: Residential rental buildings
- 39-Year Property: Nonresidential commercial buildings
Bonus Depreciation (Section 168(k))
Bonus depreciation lets you deduct a large percentage of the cost of qualifying assets in Year 1. The TCJA originally set 100% through 2022, then began phasing down (80% in 2023, 60% in 2024). The One Big Beautiful Bill Act (OBBBA), signed July 2025, permanently restored 100% bonus depreciation for property placed in service after January 19, 2025:
- 2023: 80% bonus depreciation
- 2024: 60% bonus depreciation
- 2025 and beyond: 100% bonus depreciation (OBBBA permanent)
Bonus depreciation applies to personal property (3, 5, 7, and 15-year classes) but not to buildings (27.5 or 39-year property).
Section 179 Expensing
Section 179 allows you to immediately expense the full cost of qualifying assets, up to an annual limit ($2,500,000 for 2025). Key differences from bonus depreciation:
- Section 179 has an annual dollar limit; bonus depreciation does not
- Section 179 cannot create or increase a net operating loss
- Section 179 is elected asset-by-asset; bonus depreciation applies to all eligible assets
- Section 179 phases out dollar-for-dollar above $3,130,000 in total asset purchases (2025)
Half-Year Convention
The half-year convention treats all assets as placed in service at the midpoint of the year. This is why a 5-year asset actually takes 6 calendar years to fully depreciate, and a 7-year asset takes 8 calendar years. The first and last years get partial depreciation.
Frequently Asked Questions
What is MACRS depreciation?
MACRS (Modified Accelerated Cost Recovery System) is the IRS-mandated method for depreciating business assets. It allows you to deduct the cost of an asset over a specified recovery period (3, 5, 7, 15, 27.5, or 39 years) using predetermined percentages from IRS Publication 946.
What is bonus depreciation and when does it expire?
Bonus depreciation allows you to deduct a large percentage of an asset's cost in the first year. The TCJA originally set 100% through 2022, phasing down to 80% (2023) and 60% (2024). The One Big Beautiful Bill Act (signed July 2025) permanently restored 100% bonus depreciation for property placed in service after January 19, 2025 -- no more phase-out.
What is Section 179 and how does it differ from bonus depreciation?
Section 179 lets you immediately expense the full cost of qualifying assets up to an annual limit ($2,500,000 for 2025 under the OBBBA). Unlike bonus depreciation, Section 179 has income limitations — your deduction can't exceed your business income. Section 179 is elected asset-by-asset, while bonus depreciation applies to all eligible assets in that class.
What is the half-year convention?
The half-year convention treats all assets as placed in service at the midpoint of the year, regardless of when you actually bought them. This means you get half of the first year's depreciation in year 1, and the remaining half extends the schedule by one year. The mid-quarter convention applies if more than 40% of assets are placed in service in the last quarter.
Can I depreciate my rental property?
Yes. Residential rental buildings are depreciated over 27.5 years, and commercial property over 39 years. Only the building value is depreciable — land is never depreciated. A cost segregation study can reclassify portions of a building into shorter-lived asset classes (5, 7, or 15 years) for accelerated deductions.
Maximize Your Depreciation Deductions
A CPA can help you choose the right depreciation strategy for your business assets and optimize your tax position before bonus depreciation phases out.
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