United States · Rental property · Form 4562
Rental property depreciation calculator.
A rental house or apartment building is written off over 27.5 years in straight lines, starting in the middle of the month you place it in service, and land is never depreciated. Enter the price, the land value and the month to see each year's deduction.
A rental bought for $185,000 with $25,000 of land has a $160,000 depreciable basis. Placed in service in February it gets $5,091 in the first year (3.182%) and $5,818 in each full year after. Publication 527 uses the same building and month in its own example.
Your numbers
Your result
How this is calculated
- Building basis. Purchase price minus the land, plus capitalized improvements and closing costs allocated to the building. You cannot depreciate land (Pub. 527).
- Recovery period. Residential rental property is 27.5 years under the general depreciation system, straight line, with a mid-month convention (Pub. 527; Pub. 946).
- First year. Property is treated as placed in service in the middle of its month, so the first year gets (12 minus the month number plus 0.5) twelfths of a year, divided by 27.5.
- Full years. Basis divided by 27.5, which is 3.636% a year. The last year takes the remainder.
- Year of sale. Depreciation stops at the middle of the month of disposition. Pub. 946 shows a March 2 sale as 2.5 months of use.
Worked example: Publication 527 house, $160,000 building, placed in service in February
| Year | Months of use | Rate | Deduction |
|---|---|---|---|
| 2026 | 10.5 | 3.182% | $5,091 |
| 2027 | 12 | 3.636% | $5,818 |
| 2028 | 12 | 3.636% | $5,818 |
| 2029 | 12 | 3.636% | $5,818 |
Publication 527 rounds the February first year to 3.182% and gets $5,091. The straight-line formula here gives $5,090.91, and the IRS percentage tables round to three decimals, so a Form 4562 figure can differ from this page by a few dollars. The schedule ends in 2053 with a half-year of depreciation, after $160,000 in all.
What this does not cover
- Bonus depreciation, section 179 and cost segregation, which can write off parts of a property faster.
- Separate recovery periods for appliances, furniture and land improvements. Enter only the building.
- Nonresidential real property (39 years), the alternative depreciation system, and property that is not rented for most of its use.
- Partial personal use of the property, a conversion from a home to a rental, and the deduction limits that apply to rental losses.
- The tax due on a sale. The depreciation total feeds the depreciation recapture calculator.
Method and assumptions
The schedule uses straight-line depreciation over 330 months with the mid-month convention, which gives 3.182% in the first year for a February start (the Pub. 527 table figure) and 3.636% in each full year. The land allocation is whatever you enter; the IRS lets you use fair market value or assessed value ratios. Depreciation is "allowed or allowable", so figure it even in a year you did not claim it.
Results vary with your actual income, deductions, credits and filing situation. This page uses the figures you enter and published IRS rules; it does not predict what you will earn or owe. This is general information, not tax, legal or accounting advice; confirm your own situation against the linked IRS instructions or with a qualified preparer. Nothing here collects or stores personal data.
Sources
- IRS Publication 527, Residential Rental Property, retrieved October 26, 2026
- IRS Publication 946, How To Depreciate Property, retrieved October 26, 2026
Cite this page: TNAADO Tools, "Rental property depreciation calculator," tools.tnaado.ca/us/rental-property-depreciation-calculator/, figures retrieved October 2026.
Common mix-ups
-
Often assumedI can depreciate the whole purchase price of a rental, land included.
What the source saysPublication 527 says you cannot depreciate land because land generally does not wear out, become obsolete or get used up. You split the cost between land and building and depreciate only the building. [1]
-
Often assumedA rental placed in service in January gets a full year of depreciation in its first year.
What the source saysPublication 946 explains that the mid-month convention treats property as placed in service at the midpoint of its month, so a January property gets 11.5 months of depreciation in the first year, not 12. [2]
Checked against these sources on .
Frequently asked questions
How long do you depreciate a rental property?
Residential rental property is depreciated over 27.5 years using the straight-line method and the mid-month convention, according to Publication 527. That is 3.636% of the building basis in a full year.
Can I depreciate the land?
No. Publication 527 says you cannot depreciate land because it does not wear out, become obsolete or get used up. Split your purchase price between land and building first.
When does depreciation start?
When the property is ready and available for rent, not when you buy it. The month it enters service is treated as half a month of use for that month, which is the mid-month convention.
Does depreciation reduce my basis?
Yes. Depreciation allowed or allowable lowers your adjusted basis, which raises the gain when you sell and creates depreciation recapture. See the recapture calculator linked here.
Why does my Form 4562 differ by a few dollars?
The IRS percentage tables round to three decimals and shift a thousandth between years. This page uses the exact straight-line fraction, so cents and the occasional dollar can differ.
Not tax advice
This is an educational estimate built from the numbers you enter and published IRS rules. It is not tax advice and does not predict what you will earn or owe. Selling soon? The depreciation recapture calculator uses your depreciation total.