Depreciation Calculator (MACRS)

Recovering the cost of equipment, machinery, and other business assets over time is what the Modified Accelerated Cost Recovery System (MACRS) governs, and this tool calculates those deductions for tax year 2026 and beyond under both MACRS and straight-line methods. Choosing the right approach affects how much taxable income you report each year and how quickly you recover what you spent on assets placed in service.

Calculations follow the IRS MACRS percentage table for the half-year convention (Table A-1 in Publication 946): 200% declining balance for 3-, 5-, 7- and 10-year property and 150% declining balance for 15- and 20-year property, with the switch to straight line built into the rates. Because the half-year convention treats the asset as placed in service at mid-year, the schedule runs one year past the class life, eight years for 7-year property. The tool does not handle the mid-quarter convention, which applies when more than 40% of the year's depreciable basis is placed in service in the last three months of the tax year, or the mid-month convention used for residential rental and nonresidential real property. Its Straight-Line option simply spreads the cost evenly over the number of years you pick, with no convention and no salvage value.

Recovery periods are easy to misjudge, so check IRS Publication 946 to confirm the correct property class life before relying on a result. MACRS does not cover intangible assets. The calculator also leaves out the Section 179 deduction and the special (bonus) depreciation allowance, and either can change the first-year figure dramatically: qualifying property acquired and placed in service after January 19, 2025 takes a 100% special allowance unless you elect out, and for tax years beginning in 2026 the Section 179 limit is $2,560,000, reduced by the amount qualifying purchases exceed $4,090,000. The schedule shown here is what applies when neither is claimed.