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Calculation

MACRS and MACRS SL class life methods of depreciation

MACRS method

When you select the
MACRS
 method, the MACRS depreciation deduction is determined by applying the depreciation method to the depreciable basis over the applicable recovery period, which is subject to the placed-in-service conventions.
note
The application's method of MACRS incorporates 3 different depreciation methods: 200% DB (switching to straight line when appropriate), 150% DB (switching to straight line when appropriate), and straight line. When the
MACRS
 method is selected, the application calculates current depreciation based on 1 of those methods depending on the asset's life and when it was placed in service.

MACRS SL class life method

Use the
MACRS SL Class Life
 method for a MACRS asset for which you're making the irrevocable election under Code Section 168(b)(5) to depreciate the asset straight line over the class life (as opposed to MACRS straight line over the recovery period). The asset will depreciate SL over 40 years for 27.5-, 31.5-, and 39-year recovery period property, and over 50 years for 25-year recovery period property.
note
Example for MACRS real property acquired after May 12, 1993:
  • If you enter
    MACRS
     in the
    Method
     field and you enter
    39
     in the
    Life
     field, the asset will depreciate using straight line over 39 years.
  • If you enter
    MACRS SL Class Life
     in the
    Method
     field and you enter
    39
     in the
    Life
     field, the asset will depreciate using straight line over 40 years. (40 years is the class life for 39-year recovery property.)

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