Free macrs depreciation calculator
Build a full MACRS depreciation schedule in two seconds. Enter an asset's cost and pick its recovery period — 3, 5, 7, 10, 15, or 20-year. The calculator applies the IRS GDS half-year convention tables from Publication 946 and returns the first-year deduction plus year-by-year depreciation, accumulated total, and remaining book value — updated live, as you type.
On this page15 sections
| Year | Rate | Depreciation | Book value |
|---|---|---|---|
| 1 | 20% | $10,000 | $40,000 |
| 2 | 32% | $16,000 | $24,000 |
| 3 | 19.2% | $9,600 | $14,400 |
| 4 | 11.52% | $5,760 | $8,640 |
| 5 | 11.52% | $5,760 | $2,880 |
| 6 | 5.76% | $2,880 | $0 |
Estimates use the IRS GDS half-year convention only. Not tax advice.
Results are estimates. Consult a professional.
What is MACRS depreciation?
MACRS — the Modified Accelerated Cost Recovery System — is the depreciation method the IRS requires for most business and investment property placed in service after 1986. It lets you recover the cost of an asset as a tax deduction across a fixed recovery period, front-loading the deductions into the early years so you get a bigger write-off sooner. This MACRS depreciation calculator applies the official IRS percentage tables to your asset's cost and class life and returns the full year-by-year schedule the moment you enter a cost and pick a recovery period.
Why MACRS is 'accelerated'
Unlike straight-line depreciation, which spreads cost evenly, MACRS uses a declining-balance method (200% or 150%) that switches to straight-line when that becomes more favorable. The result is larger deductions in the first few years and smaller ones later. For a business, that means more of the tax benefit arrives early — improving cash flow when a newly purchased asset is freshest.
How to calculate MACRS depreciation
MACRS looks complicated, but the IRS percentage tables reduce it to three steps. You never have to compute declining-balance math by hand — the published rate already contains it.
- Find the depreciable cost basis. Start with the purchase price plus costs to place the asset in service (shipping, installation), then subtract any Section 179 expense and bonus depreciation you elect to take first.
- Identify the property class. The IRS assigns every asset a recovery period — 3, 5, 7, 10, 15, or 20 years for most equipment. Vehicles and computers are 5-year; office furniture is 7-year.
- Apply the table rate for each year. Multiply the cost basis by the IRS percentage for that recovery year. The calculator above does this for every year, then tracks accumulated depreciation and remaining book value.
The MACRS depreciation table (half-year convention)
These are the IRS General Depreciation System (GDS) half-year convention percentages from Publication 946, Appendix A, Table A-1 — the same rates this calculator uses. Each column is one property class; each row is the percentage of the original cost you depreciate in that tax year. Every column sums to 100%.
| Year | 3-year | 5-year | 7-year | 10-year | 15-year | 20-year |
|---|---|---|---|---|---|---|
| 1 | 33.33% | 20.00% | 14.29% | 10.00% | 5.00% | 3.750% |
| 2 | 44.45% | 32.00% | 24.49% | 18.00% | 9.50% | 7.219% |
| 3 | 14.81% | 19.20% | 17.49% | 14.40% | 8.55% | 6.677% |
| 4 | 7.41% | 11.52% | 12.49% | 11.52% | 7.70% | 6.177% |
| 5 | — | 11.52% | 8.93% | 9.22% | 6.93% | 5.713% |
| 6 | — | 5.76% | 8.92% | 7.37% | 6.23% | 5.285% |
| 7 | — | — | 8.93% | 6.55% | 5.90% | 4.888% |
| 8 | — | — | 4.46% | 6.55% | 5.90% | 4.522% |
| 9 | — | — | — | 6.56% | 5.91% | 4.462% |
| 10 | — | — | — | 6.55% | 5.90% | 4.461% |
| 11 | — | — | — | 3.28% | 5.91% | 4.462% |
| 12–20 | — | — | — | — | ≈5.90% | ≈4.461% |
| 21 | — | — | — | — | 2.95% (yr 16) | 2.231% |
Source: IRS Publication 946, Table A-1 (GDS, 200%/150% declining balance, half-year convention). 3, 5, 7, and 10-year classes use 200% DB; 15 and 20-year use 150% DB.
A worked example using the MACRS depreciation calculator
A small business buys a $50,000 delivery van and places it in service this year. Vehicles are 5-year MACRS property under the half-year convention. Here is how the calculator builds the schedule, year by year.
Step 1 — Enter the cost basis and recovery period
Enter a cost of $50,000 and select the 5-year recovery period. The calculator looks up the 5-year column of the IRS table (20%, 32%, 19.2%, 11.52%, 11.52%, 5.76%) and is ready to multiply.
Step 2 — Multiply the basis by each year's rate
| Year | Rate | Depreciation | Book value |
|---|---|---|---|
| 1 | 20.00% | $10,000 | $40,000 |
| 2 | 32.00% | $16,000 | $24,000 |
| 3 | 19.20% | $9,600 | $14,400 |
| 4 | 11.52% | $5,760 | $8,640 |
| 5 | 11.52% | $5,760 | $2,880 |
| 6 | 5.76% | $2,880 | $0 |
Step 2 result: $50,000 fully depreciated over six tax years.
Step 3 — Read the first-year deduction
Now compare that to straight-line. Straight-line over five years would deduct a flat $10,000 every year. MACRS lets the business deduct $26,000 in the first two years combined — far more than the $20,000 straight-line would allow — pulling the tax benefit forward when the cash matters most.
MACRS property classes: what's 5-year vs 7-year?
The recovery period is set by the IRS, not by you — every asset is assigned a class life. Picking the wrong class is the most common MACRS error. These are the GDS classes for personal property:
| Recovery period | Typical assets |
|---|---|
| 3-year | Tractors, certain tools, racehorses over two years old, qualified rent-to-own property |
| 5-year | Cars, light trucks, computers, office equipment, copiers, R&D equipment, cattle |
| 7-year | Office furniture and fixtures (desks, chairs, files), most machinery, agricultural equipment |
| 10-year | Single-purpose agricultural structures, water transportation vessels, fruit-bearing trees |
| 15-year | Land improvements (fences, sidewalks, landscaping), qualified improvement property, gas stations |
| 20-year | Farm buildings, municipal sewers, certain utility property |
GDS recovery periods for common personal property. Real estate is separate: residential rental is 27.5-year and nonresidential is 39-year, both straight-line.
GDS vs ADS: which MACRS system applies?
MACRS has two depreciation systems. The General Depreciation System (GDS) is the default and the one this calculator uses — it employs the accelerated declining-balance methods and shorter recovery periods that produce the bigger early deductions. The Alternative Depreciation System (ADS) is required for specific situations and uses straight-line over a longer life.
- GDS (default) — 200% or 150% declining balance, shorter recovery periods. Used for most business assets. The fastest write-off.
- ADS (required in certain cases) — straight-line over a longer recovery period. Required for tax-exempt-use property, property used predominantly outside the US, listed property used 50% or less for business, and some farming and import-financed property.
You can also elect ADS voluntarily, but once chosen for a class of property it generally can't be revoked. Most businesses stay on GDS to maximize early deductions.
Half-year vs mid-quarter convention
A convention decides how much depreciation you get in the first and last years, based on when during the year the asset was placed in service. For personal property MACRS uses two:
- Half-year convention (default). Treats every asset as placed in service at the midpoint of the year, so you take half a year of depreciation in Year 1 — regardless of the actual date. This is the convention in the table above and in this calculator.
- Mid-quarter convention. Required if more than 40% of the total basis of all property you placed in service that year fell in the last quarter (October–December). It then treats each asset as placed in service at the midpoint of its quarter, which lowers the deduction for late-year purchases.
Bonus depreciation and Section 179 vs MACRS
MACRS spreads a deduction over years, but two provisions let you accelerate even further — often writing off the entire cost in Year 1. They are applied before MACRS, reducing the basis MACRS then depreciates.
- Section 179 expensing — lets you immediately deduct the full cost of qualifying equipment, up to an annual cap ($1,250,000 for 2025), limited to your business income. Applied first.
- Bonus depreciation — a first-year deduction on qualifying property (generally a MACRS recovery period of 20 years or less). The One Big Beautiful Bill Act (July 2025) permanently restored 100% bonus depreciation for property acquired after January 19, 2025. Applied after Section 179.
- MACRS — depreciates whatever basis remains after Section 179 and bonus, using the table rates above.
The order is fixed: Section 179 first, then bonus depreciation, then MACRS on the remainder. If you elect 100% bonus on a fully qualifying asset, there is no remaining basis and MACRS contributes nothing. Pair this with a straight-line depreciation calculator to compare the methods side by side.
MACRS vs straight-line depreciation
Both methods deduct the same total cost over the asset's life — they differ only in timing. MACRS front-loads; straight-line is even. The choice matters for cash flow and for the book-versus-tax difference businesses track.
| MACRS (GDS) | Straight-line | |
|---|---|---|
| Pattern | Accelerated (declining balance) | Even each year |
| First-year deduction | Largest relative to later years | Same as every other year |
| Used for | Federal income tax (required) | Financial statements (GAAP) |
| Recovery period | IRS class life | Estimated useful life |
| Salvage value | Ignored (depreciates to $0) | Subtracted from cost first |
MACRS is the tax method; most companies use straight-line for their books, creating a temporary timing difference.
A key quirk: MACRS ignores salvage value entirely and depreciates the asset all the way to zero, whereas straight-line subtracts an estimated salvage value first. That is one reason book and tax depreciation rarely match in any given year, and why businesses keep two sets of depreciation figures — one for the IRS and one for their financial statements. Over the full life of the asset the totals converge, but in any single year the gap between the accelerated tax deduction and the even book expense creates a deferred-tax timing difference that accountants reconcile on the balance sheet.
Sources and methodology
Every percentage in this calculator comes from IRS Publication 946, How To Depreciate Property, Appendix A, Table A-1 — the GDS half-year convention table. The calculator multiplies your cost basis by the table rate for each recovery year and tracks accumulated depreciation and book value; it does not apply Section 179, bonus depreciation, the mid-quarter convention, or business-use percentage, which depend on facts specific to your return.
Frequently asked questions about the free macrs depreciation calculator
About this MACRS depreciation calculator
This MACRS depreciation calculator runs entirely in your browser. Every figure you enter stays on your device — nothing is sent to a server, logged, or shared. It applies the IRS General Depreciation System half-year convention percentages from Publication 946, Table A-1, multiplying your cost basis by each year's rate and tracking accumulated depreciation and book value, updating instantly as you change the cost or recovery period.
Calculators Cloud offers 400+ free tools with no sign-up. The whole Finance calculators shelf includes straight-line Depreciation, Rental property, and investment tools alongside this one. Or browse the full calculator directory.