MACRS Depreciation Table: Complete Guide to IRS Percentage Tables
- Greg Pacioli
- 6 days ago
- 11 min read
If you've ever stared at IRS Publication 946 wondering how to actually use those MACRS depreciation tables, you're not alone. The Modified Accelerated Cost Recovery System sounds complicated, but once you understand how to read the percentage tables, calculating depreciation becomes straightforward. The tables do the heavy lifting, you just need to know which one to use and how to apply it.
Think of the MACRS depreciation table as a cheat sheet from the IRS that gives you the exact percentage to multiply against your asset's cost for each year of its life.
Instead of calculating declining balance rates and making the switch to straight-line manually, the IRS has done the math for you. You look up your property class (5 year, 7 year, etc.), find the year you're in, and multiply. That's it.
However, there are multiple MACRS tables depending on your property class, which convention applies (half-year vs. mid-quarter), and whether you're using the General Depreciation System (GDS) or Alternative Depreciation System (ADS). This guide breaks down exactly which MACRS depreciation table you need, how to read it, and how to apply it correctly for your tax return.
What Is the MACRS Depreciation Table?
The MACRS depreciation table is a set of percentage tables published in IRS Publication 946 (specifically from Revenue Procedure 87-57) that shows the depreciation rate for each year of an asset's recovery period.
These tables combine three critical factors into a single percentage:
Depreciation Method
200%, 150% declining balance, or straight-line
Recovery Period
3, 5, 7, 10, 15, 20, 27.5, or 39 years
Convention
half-year, mid-quarter, or mid-month
The genius of these tables is that they automatically handle the switch from declining balance to straight-line depreciation at the optimal point to maximize your deduction. It's baked into the percentages.
Why the MACRS Table Exists
Before MACRS was introduced in 1986, taxpayers had to manually calculate depreciation using various methods with different useful lives. It was complicated, inconsistent, and led to frequent errors.
The MACRS table system standardized everything.
For a complete understanding of how MACRS fits into the broader depreciation landscape, check out our comprehensive playbook for IRS Publication 946, which covers the entire framework of property depreciation.
Complete 5 Year MACRS Table (*Half-Year Convention)
The 5-year MACRS table is one of the most commonly used depreciation tables because it covers vehicles, computers, office equipment, and certain machinery. Here are the percentages using the General Depreciation System with the half-year convention:
Recovery Year | 5-Year Property Percentage |
Year 1 | 20.00% |
Year 2 | 32.00% |
Year 3 | 19.20% |
Year 4 | 11.52% |
Year 5 | 11.52% |
Year 6 | 5.76% |
Total | 100.00% |
*Notice something important:
A 5-year property actually has six rows. This is because of the half-year convention, which treats all property as placed in service at the mid-point of the year. You get only half a year of depreciation in Year 1, so the remaining half spills into Year 6.
What Property Uses the 5-Year MACRS Table?
Common assets depreciated over 5 years include:
Automobiles (with a gross vehicle weight under 6,000 lbs)
Light trucks and vans
Computers and peripheral equipment
Office machinery (copiers, calculators, typewriters)
Certain manufacturing equipment
Construction assets with ADR class lives of 4 to 10 years
Qualified technological equipment (semiconductor manufacturing)
Computer software (off-the-shelf, not custom)
Complete MACRS Depreciation Tables for All Property Classes
Here are the complete MACRS depreciation percentage tables for all common property classes using the half-year convention and GDS.
3-Year MACRS Table (200% Declining Balance)
Recovery Year | 3-Year Property |
Year 1 | 33.33% |
Year 2 | 44.45% |
Year 3 | 14.81% |
Year 4 | 7.41% |
Total | 100.00% |
Common 3-year property: Race horses over 2 years old, certain manufacturing tools, qualified rent-to-own property, tractors for over-the-road use.
7-Year MACRS Table (200% Declining Balance)
Recovery Year | 7-Year Property |
Year 1 | 14.29% |
Year 2 | 24.49% |
Year 3 | 17.49% |
Year 4 | 12.49% |
Year 5 | 8.93% |
Year 6 | 8.92% |
Year 7 | 8.93% |
Year 8 | 4.46% |
Total | 100.00% |
Common 7-year property: Office furniture and fixtures, desks, chairs, safes, machinery not otherwise classified, agricultural equipment, natural gas gathering lines.
10-Year MACRS Table (200% Declining Balance)
Recovery Year | 10-Year Property |
Year 1 | 10.00% |
Year 2 | 18.00% |
Year 3 | 14.40% |
Year 4 | 11.52% |
Year 5 | 9.22% |
Year 6 | 7.37% |
Year 7 | 6.55% |
Year 8 | 6.55% |
Year 9 | 6.56% |
Year 10 | 6.55% |
Year 11 | 3.28% |
Total | 100.00% |
Common 10-year property: Vessels, barges, tugs, single-purpose agricultural structures, trees/vines bearing fruit or nuts, equipment for petroleum refining.
15-Year MACRS Table (150% Declining Balance)
Recovery Year | 15-Year Property |
Year 1 | 5.00% |
Year 2 | 9.50% |
Year 3 | 8.55% |
Year 4 | 7.70% |
Year 5 | 6.93% |
Year 6 | 6.23% |
Year 7 | 5.90% |
Year 8 | 5.90% |
Year 9 | 5.91% |
Year 10 | 5.90% |
Year 11 | 5.91% |
Year 12 | 5.90% |
Year 13 | 5.91% |
Year 14 | 5.90% |
Year 15 | 5.91% |
Year 16 | 2.95% |
Total | 100.00% |
Common 15-year property: Land improvements (sidewalks, roads, fences, landscaping), restaurant property, gas stations, certain qualified improvement property (pre-TCJA).
20-Year MACRS Table (150% Declining Balance)
Recovery Year | 20-Year Property |
Year 1 | 3.750% |
Year 2 | 7.219% |
Year 3 | 6.677% |
Year 4 | 6.177% |
Year 5 | 5.713% |
Year 6 | 5.285% |
Year 7 | 4.888% |
Year 8 | 4.522% |
Year 9 | 4.462% |
Year 10 | 4.461% |
Year 11 | 4.462% |
Year 12 | 4.461% |
Year 13 | 4.462% |
Year 14 | 4.461% |
Year 15 | 4.462% |
Year 16 | 4.461% |
Year 17 | 4.462% |
Year 18 | 4.461% |
Year 19 | 4.462% |
Year 20 | 4.461% |
Year 21 | 2.231% |
Total | 100.00% |
Common 20-year property: Farm buildings (except single-purpose agricultural structures), municipal sewers, certain utility property.
Real Property MACRS Tables (27.5-Year and 39-Year)
Real property uses the mid-month convention (not half-year) and the straight-line method (not declining balance). The depreciation percentage depends on the month the property was placed in service.
27.5-Year Residential Rental Property Table (Sample - Month 1)
For residential placed in service in January (Month 1):
Year 1: 3.485%
Year 2-27: 3.636% (full year)
Year 28: 3.637%
Year 29: 0.000%
The pattern shifts based on the month placed in service. Properties placed in service later in the year get fewer months of depreciation in Year 1.
39-Year Commercial Property Table (Sample - Month 1)
For nonresidential placed in service in January (Month 1):
Year 1: 2.461%
Year 2-39: 2.564% (full year)
Year 40: 0.107%
How to Use the MACRS Depreciation Tables
A 6-Step Checklist for Calculating Depreciation
Follow these six steps to determine your annual depreciation deduction using the IRS MACRS tables.
✅ Step 1: Identify Your Property Class
Determine the asset's recovery period.
Asset Type | Recovery Period |
Computers & Office Equipment | 5 Years |
Office Furniture | 7 Years |
Land Improvements (Fencing, Parking Lots, Landscaping) | 15 Years |
Residential Rental Property | 27.5 Years |
Commercial Buildings | 39 Years |
Reference: IRS Publication 946, Appendix B
✅ Step 2: Calculate Your Depreciable Basis
Your depreciable basis is generally:
Purchase Price− Section 179 Deduction− Bonus Depreciation± Other Basis Adjustments
Example:
Purchase Price ............... $100,000
Section 179 .................... ($25,000)
Depreciable Basis = $75,000
This is the amount you'll use in the MACRS tables.
✅ Step 3: Determine Which Convention Applies
Half-Year Convention
✔ Most common
✔ Used for most personal property
✔ Assumes assets were placed in service halfway through the year
Mid-Quarter Convention
Applies if more than 40% of depreciable personal property is placed in service during the fourth quarter.
Uses different IRS tables based on the quarter:
Q1
Q2
Q3
Q4
Mid-Month Convention
Always applies to:
Residential rental property
Commercial real estate
Treats property as placed into service in the middle of the month.
✅ Step 4: Select the Correct IRS Table
IRS Table | Property Type |
A-1 | 3, 5, 7, 10, 15 & 20-Year Property (Half-Year) |
A-2 – A-5 | Mid-Quarter Convention |
A-6 | Residential Rental Property (27.5 Years) |
A-7 | Commercial Property (39 Years) |
✅ Step 5: Multiply by the MACRS Percentage
Find the percentage for the appropriate recovery year and multiply it by your depreciable basis.
Example
Property Type: 7-Year Office Furniture
Depreciable Basis: $75,000
Year: 2
MACRS Rate: 24.49%
Annual Depreciation
$75,000 × 24.49% = $18,367.50
✅ Step 6: Repeat Each Year
Continue using the same MACRS table until the asset has been fully depreciated.
Remember:
✔ Always use the original depreciable basis
✔ Do not recalculate using book value each year
✔ Only adjust if the property is sold, disposed of, or experiences another basis adjustment.
Quick Tips
✓ Start by identifying the correct property class.
✓ Choose the correct depreciation convention.
✓ Use the matching IRS table.
✓ Apply the percentage to the original depreciable basis.
✓ Repeat annually until the recovery period ends.
MACRS Depreciation Table for Real Property
Real property (buildings) always uses the mid-month convention and straight-line depreciation. The percentage depends on which month the property was placed in service.
27.5-Year Residential Rental Property
First-Year Depreciation Percentages by Month Placed in Service:
Month | Year 1% | Years 2-27% | Year 28% | Year 29% |
January | 3.485% | 3.636% | 3.637% | 0.000% |
February | 3.182% | 3.636% | 3.636% | 0.152% |
March | 2.879% | 3.636% | 3.636% | 0.455% |
April | 2.576% | 3.636% | 3.636% | 0.758% |
May | 2.273% | 3.636% | 3.636% | 1.061% |
June | 1.970% | 3.636% | 3.636% | 1.364% |
July | 1.667% | 3.636% | 3.636% | 1.667% |
August | 1.364% | 3.636% | 3.636% | 1.970% |
September | 1.061% | 3.636% | 3.636% | 2.273% |
October | 0.758% | 3.636% | 3.636% | 2.576% |
November | 0.455% | 3.636% | 3.636% | 2.879% |
December | 0.152% | 3.636% | 3.636% | 3.182% |
39-Year Nonresidential Real Property
First-Year Depreciation Percentages by Month Placed in Service:
Month | Year 1% | Years 2-39% | Year 40% |
January | 2.461% | 2.564% | 0.107% |
February | 2.247% | 2.564% | 0.321% |
March | 2.033% | 2.564% | 0.535% |
April | 1.819% | 2.564% | 0.749% |
May | 1.605% | 2.564% | 0.963% |
June | 1.391% | 2.564% | 1.177% |
July | 1.177% | 2.564% | 1.391% |
August | 0.963% | 2.564% | 1.605% |
September | 0.749% | 2.564% | 1.819% |
October | 0.535% | 2.564% | 2.033% |
November | 0.321% | 2.564% | 2.247% |
December | 0.107% | 2.564% | 2.461% |
Alternative Depreciation System (ADS) Tables
The Alternative Depreciation System uses straight-line depreciation over longer recovery periods.
ADS is required for:
Property used predominantly outside the United States
Tax-exempt use property
Tax-exempt bond-financed property
Certain farm property if you elect not to apply the uniform capitalization rules
Property imported from a country with which the U.S. has a trade agreement that requires ADS
ADS Recovery Periods vs. GDS
Property Type | GDS Period | ADS Period |
Computers | 5 years | 5 years |
Office furniture | 7 years | 10 years |
Land improvements | 15 years | 20 years |
Nonresidential real property | 39 years | 40 years |
Residential rental property | 27.5 years | 30 years |
5-Year ADS Table (Straight-Line, Half-Year)
Recovery Year | 5-Year ADS |
Year 1 | 10.00% |
Year 2 | 20.00% |
Year 3 | 20.00% |
Year 4 | 20.00% |
Year 5 | 20.00% |
Year 6 | 10.00% |
Total | 100.00% |
Notice the even distribution compared to the accelerated GDS table, this is the cost of using ADS.
Common MACRS Depreciation Table Mistakes
Mistake #1: Using Book Value Instead of Original Basis
❌ Wrong: Multiply declining book value by the MACRS percentage each year.
✅ Right: Always multiply the original depreciable basis by the table %.
Example:
Asset cost: $10,000
Year 1 depreciation (20%): $2,000
Remaining book value: $8,000
Year 2 calculation:
❌ Wrong: $8,000 × 32% = $2,560
✅ Right: $10,000 × 32% = $3,200
The MACRS table percentages are already designed to be applied to the original cost.
Mistake #2: Not Accounting for Section 179 or Bonus Depreciation
If you claimed Section 179 or bonus depreciation, you must reduce the basis before applying MACRS percentages.
Example:
Equipment cost: $50,000
Section 179 claimed: $25,000
Basis for MACRS table: $25,000 (not $50,000)
Mistake #3: Using the Wrong Table When Mid-Quarter Applies
Many taxpayers use half-year tables when mid-quarter is required, leading to incorrect deductions.
Prevention: Test the 40% threshold before finalizing year-end property purchases.
Mistake #4: Applying Personal Property Tables to Real Property
Buildings ALWAYS use mid-month convention and straight-line method. Never use the 5-year, 7-year, or other personal property tables for buildings.
Mistake #5: Forgetting the Disposition Year Adjustment
When you dispose of property, you can only claim half a year of depreciation in the year of sale (under half-year convention).
Example:
7-year property in Year 3
Normal Year 3 percentage: 17.49%
Sold in Year 3: Claim only 8.75% (17.49% ÷ 2)
How MACRS Tables Interact with Bonus Depreciation
Under the One Big Beautiful Bill Act (OBBBA) 100% bonus depreciation is permanently restored for qualified property placed in service after January 19, 2025.
Order of Deductions
When both bonus depreciation and MACRS apply:
Section 179 deduction (if elected)
Bonus depreciation (if not elected out)
MACRS depreciation (on remaining basis)
Example:
Equipment cost: $100,000 (5-year property, placed in service 2026)
Section 179 elected: $25,000
Remaining basis: $75,000
Bonus depreciation (100%): $75,000
MACRS depreciation: $0 (nothing left to depreciate)
If you elected out of bonus depreciation:
Equipment cost: $100,000
Section 179 elected: $25,000
Remaining basis: $75,000
MACRS Year 1 (20%): $75,000 × 20% = $15,000
When MACRS Tables Still Matter
Even with 100% bonus depreciation available, MACRS tables remain critical for:
Real property (27.5-year and 39-year) bonus doesn't apply
Used property acquired before OBBBA
Taxpayers who elect out of bonus depreciation
Property that doesn't qualify for bonus (e.g., listed property not used >50% for business)
Cost segregation on properties placed in service in prior years (catch-up depreciation)
Cost Segregation and MACRS Depreciation Tables
Cost segregation studies identify building components that can be reclassified from 39-year property to 5-year, 7-year, or 15-year property. This reclassification allows you to use the accelerated MACRS tables instead of the slow 39-year straight-line table.
Typical Cost Segregation Breakdown
For a $2,000,000 commercial building:
Component | % of Total | Amount | Recovery Period | Year 1 MACRS % |
Land | 15% | $300,000 | N/A | 0% |
Building structure | 50% | $1,000,000 | 39 years | 2.564% |
Land improvements | 10% | $200,000 | 15 years | 5.00% |
Personal property | 15% | $300,000 | 5-7 years | 14.29%-20.00% |
Total | 100% | $2,000,000 | — | — |
Without cost segregation:
Year 1 depreciation = $1,700,000 × 2.564% (39-year table) = $43,588
With cost segregation:
Building: $1,000,000 × 2.564% = $25,640
Land improvements: $200,000 × 5.00% = $10,000
Personal property (7-year avg): $300,000 × 14.29% = $42,870
Total Year 1 = $78,510
That's an 80% increase in year-1 depreciation, made possible by using the accelerated MACRS tables on reclassified components.
For more on how cost segregation works with MACRS, see our detailed Publication 946 playbook.
MACRS Depreciation Table FAQs
What is the The MACRS 5 year table?
The 5-year MACRS table shows depreciation percentages for property with a recovery period of 5 years (like vehicles, computers, and office equipment). Using the half-year convention, the percentages are:
Year 1 = 20.00%, Year 2 = 32.00%, Year 3 = 19.20%, Year 4 = 11.52%, Year 5 = 11.52%, Year 6 = 5.76%.
What's the difference between MACRS and straight-line depreciation?
MACRS tables use accelerated methods (200% or 150% declining balance) that front-load deductions in early years before switching to straight-line. Straight-line depreciation spreads the cost evenly across the useful life. MACRS provides larger tax benefits early in the asset's life.
Do I use the MACRS table annually?
Yes. You use the same MACRS table for the entire recovery period of the asset. Each year, move down one row in the table to find that year's percentage, then multiply it by your original depreciable basis.
What happens if I sell property before the recovery period ends?
You claim depreciation for the year of sale using a half-year convention (for most property). For example, if you normally claim 17.49% in Year 3 but sell mid-year, you claim only 8.75% (half of 17.49%). Any gain or loss on the sale is calculated using the adjusted basis after depreciation.
Can I choose not to use MACRS?
You must use MACRS for most property placed in service after 1986. However, you can elect the Alternative Depreciation System (ADS), which uses straight-line over longer periods. You can also elect out of bonus depreciation and Section 179, but you must still use MACRS tables for regular depreciation.
Why does 5 year property have 6 years in the table?
The half-year convention treats property as placed in service at the 6 month point of the year. You get only half a year of depreciation in Year 1, so the remaining half spills into Year 6. This pattern applies to all property classes: 3-year has 4 rows, 7-year has 8 rows, etc.
What if I placed more than 40% of property in Q4?
You must use the mid-quarter convention instead of the half-year convention. This requires different MACRS tables (A-2 through A-5) based on which quarter each asset was placed in service. The mid-quarter tables show different percentages than the standard half-year table.
Do I need to calculate anything or just use the table percentage?
Just multiply the table percentage by your original depreciable basis. The IRS has already done the complex calculations (declining balance, switch to straight-line, half-year convention) and baked them into the percentage. You don't need to calculate manually, tax advisor can help sort this out.
Accelerate Your Depreciation Deductions?
If you own commercial real estate or rental property, a cost segregation study can reclassify your building components to use shorter MACRS tables (potentially generating six-figure deductions).
Request a Complimentary Cost Segregation Estimate from listings on www.FindCostSeg.com
This MACRS Depreciation guide is for educational purposes only. Consult your tax advisor regarding questions on your specific situation.