Rental property depreciation calculator
Depreciation is the deduction most self-managed landlords underclaim, and the one that surprises them at sale. This works the annual figure, the first partial year, and the total you are eventually recapturing.
Pre-filled with the example unit and a 22% assessed land share. Use YOUR assessor's split, not a rule of thumb.
Annual depreciation deduction, years 2 onward
$9,194.91
- Land excluded
- $68,640.00
- Depreciable basis
- $252,860.00
- Recovery period
- 27.5 years
- Full-year deduction
- $9,194.91
- First-year deduction (mid-month)
- $2,681.85
- Total over 27.5 years
- $252,860.00
IRS Pub. 527, Table 2-1 — residential rental property under GDS.
3.5 months counted for a month-9 in-service date.
Splitting land out of the basis
Only the building depreciates. The usual method is to take the assessor's split between land and improvements and apply that ratio to what you actually paid. If the assessment says 22% land, then 22% of your basis never depreciates, whatever the market did afterwards.
- 01Start with the purchase price plus capitalised acquisition costs.
- 02Apply the assessor's land percentage; set that share aside.
- 03Add capital improvements made since — a new roof, a rebuilt kitchen.
- 04Repairs are not added here; they are deducted in the year you paid them.
Improvements and repairs are different animals
Replacing a roof is an improvement, depreciated over its own schedule. Patching one is a repair, deducted this year. Getting this wrong in either direction is the most common amendment on a landlord return.
Where 27.5 years comes from
IRS Publication 527, Table 2-1 (checked 2026-09-04) sets the general depreciation system recovery period for residential rental property at 27.5 years. Appliances and carpet sit on shorter schedules; land improvements on another. The mid-month convention means the first year counts from the middle of the month the property was placed in service, which is what the first-year line above applies.
The bill at the other end
Depreciation is not free money; it is a deferral. On sale, the amount allowed or allowable is recaptured — meaning the IRS assumes you took it whether you did or not. That last phrase is why not claiming depreciation is the worst of both worlds: no deduction now, and the recapture anyway.
Talk to a preparer before you sell
Recapture, capital gains and a 1031 exchange interact in ways that move five figures. This page does arithmetic; it does not do your return.
The deductions that sit beside it are in landlord tax deductions.
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