Depreciation

tax

Also known as: depreciation, tax depreciation

Updated May 11, 2026 · Written and reviewed by Konstantin Iakovlev

Detailed explanation

For 2026, Section 179 lets businesses deduct up to $1.16M of qualifying property in the year placed in service (phase-out begins at $2.89M total purchases). Bonus depreciation is 60% in 2026 (down from 100% in 2022, phasing out toward 0% by 2027). MACRS provides 5-year (autos, computers), 7-year (furniture, fixtures), 15-year (qualified improvements), 27.5-year (residential rental), or 39-year (commercial) depreciation schedules. Real estate depreciation must be recaptured at sale (taxed up to 25%).

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Effective Tax Rate

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