Thursday, April 25, 2024

Depreciation MACRS Table for Asset’s Life

depreciation macrs table

The depreciation MACRS table for asset’s life below is taken out of IRS Publication .This depreciation table specifies lives for property subject to depreciation under the general depreciation system provided in section 168(a) of the IRC or the alternative depreciation system provided in section 168(g).

What is MACRS depreciation? MACRS stands for Modified Accelerated Cost Recovery System – is the tax depreciation system used to calculate your the depreciation of your tangible (depreciable) assets that is allowed a tax deduction. The MACRS depreciation method is significantly different from the straight-line depreciation, wherein depreciation claim for each year, until the end of the asset’s usable life remains same. Under MACRS , you get more in the beginning years. So , the tax implication in the beginning years are significant for business.

(1) Depreciation MACRS Table for Assets Common to All Kinds of Business

*Description of assets included*Class Life (in years)Recovery Periods
(in years)
General Depreciation System**Alternative Depreciation System*
Office Furniture, Fixtures, & Equip.
(This class includes furniture and fixtures that are not a structural component of a building. Includes such assets as desks, files, safes, and communications equipment. Does not include communications equipment that is included in other classes.)
Information Systems

(Information systems include computers and their peripheral equipment used in administering normal business transactions and the maintenance of  business records, their retrieval and analysis. Information systems are defined as follows:

1) Computers: A computer is a programmable electronically activated device  capable of accepting information, applying prescribed processes to the 
information, and supplying the results of these processes with or without  human intervention. It usually consists of a central processing unit 
containing extensive storage, logic, arithmetic, and control capabilities.  Excluded from this category are adding machines, electronic desk  calculators, etc., and other equipment described in class 00.13.

2) Peripheral equipment consists of the auxiliary machines which are  designed to be placed under control of the central processing unit. 
Nonlimiting examples are: Card readers, card punches, magnetic tape feeds, high speed printers, optical character readers, tape cassettes, mass 
storage units, paper tape equipment, keypunches, data entry devices, teleprinters, terminals, tape drives, disc drives, disc files, disc packs, 
visual image projector tubes, card sorters, plotters, and collators. Peripheral equipment may be used on-line or off-line. Does not include 
equipment that is an integral part of other capital equipment that is included in other classes of economic activity, i.e., computers used 
primarily for process or production control, switching, channeling, and automating distributive trades and services such as point of sale (POS) 
computer systems. Also, does not include equipment of a kind used primarily for amusement or entertainment of the user.)
65 (Property described in asset class 00.12 which is qualified technological 
equipment as defined in section 168(i)(2) is assigned a recovery period of 
5 years notwithstanding its class life.)

(Property described in asset class 00.12 which is qualified technological 
equipment as defined in section 168(i)(2) is assigned a recovery period of 
5 years notwithstanding its class life.)
Data Handling Equipment, Except Computers
Includes only typewriters, calculators, adding and accounting machines, copiers, and duplicating equipment.
Airplanes (airframes & engines), except those used in commercial or  contract carrying of passengers or freight, & all helicopters (airframes & 
Automobiles, Taxis355
Light General Purpose Trucks
Includes trucks for use over the road (actual unloaded weight less than 13,000 pounds).
Heavy General Purpose Trucks
Includes heavy general purpose trucks, concrete ready mix-truckers, and ore  trucks, for use over the road (actual unloaded weight 13,000 pounds or 
Railroad Cars & Locomotives, except those owned by railroad transportation 
Tractor Units For Use Over-The-Road434
Trailers & Trailer-Mounted Containers656
Vessels, Barges, Tugs, & Similar Water Transportation Equip., except those used in marine construction181018
Land Improvements
Includes improvements directly to or added to land, whether such improvements are section 1245 property or section 1250 property, provided 
such improvements are depreciable. Examples of such assets might include sidewalks, roads, canals, waterways, drainage facilities, sewers (not 
including municipal sewers in Class 51), wharves and docks, bridges, fences, landscaping, shrubbery, or radio and television transmitting 
towers. Does not include land improvements that are explicitly included in any other class, and buildings and structural components as defined in 
section 1.48-1(e) of the regulations. Excludes public utility initial clearing and grading land improvements as specified in Rev. Rul. 72-403, 
1972-2 C.B. 102.
Industrial Steam and Electric Generation and/or Distribution Systems
(This class Includes assets, whether such assets are section 1245 property or 1250 
property, providing such assets are depreciable, used in the production  and/or distribution of electricity with rated total capacity in excess of 500 Kilowatts and/or assets used in the production and/or distribution of steam with rated total capacity in excess of 12,500 pounds per hour for use by the taxpayer in its industrial manufacturing process or plant activity and not ordinarily available for sale to others. Does not include buildings and structural components as defined in section 1.48-1(e) of the regulations. Assets used to generate and/or distribute electricity or steam of the type described above but of lesser rated capacity are not included, but are included in the appropriate manufacturing equipment classes elsewhere specified. Also includes electric generating and steam distribution assets, which may utilize steam produced by a waste reduction and resource recovery plant, used by the taxpayer in its industrial manufacturing process or plant activity. Steam and chemical recovery boiler systems used for the recovery and regeneration of chemicals used in manufacturing, with rated capacity in excess of that described above, with specifically related distribution and return systems are not included but are included in appropriate manufacturing equipment classes elsewhere specified. An example of an excluded steam and chemicalrecovery boiler system is that used in the pulp and paper manufacturing industry.)

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