Professional Documents
Culture Documents
Property Class Under GDS Class recovery period (Useful Life) 3-year Asset types Tractor units for over-the-road use. Any race horse over 2 years old when placed in service. (All race horses placed in service after December 31, 2008, and before January 1, 2014, are deemed to be 3-year property, regardless of age.) Any other horse (other than a race horse) over 12 years old when placed in service. Qualified rent-to-own property (defined in pub. 946). Automobiles, taxis, buses, and trucks. Computers and peripheral equipment. Office machinery (such as typewriters, calculators, and copiers). Any property used in research and experimentation. Breeding cattle and dairy cattle. Appliances, carpets, furniture, etc., used in a residential rental real estate activity. Certain geothermal, solar, and wind energy property. Office furniture and fixtures (such as desks, files, and safes). Agricultural machinery and equipment. Any property that does not have a class life and has not been designated by law as being in any other class. Certain motorsports entertainment complex property placed in service before January 1, 2012 (defined later). Any natural gas gathering line placed in service after April 11, 2005. See Natural gas gathering line, natural gas distribution line, and electric transmission property, later. Vessels, barges, tugs, and similar water transportation equipment. Any single purpose agricultural or horticultural structure. Any tree or vine bearing fruits or nuts. Qualified small electric meter and qualified smart electric grid system (defined in pub. 946) placed in service on or after October 3, 2008. Certain improvements made directly to land or added to it (such as shrubbery, fences, roads, sidewalks, and bridges). Any retail motor fuels outlet (defined in pub. 946), such as a convenience store. Any municipal wastewater treatment plant. Any qualified leasehold improvement property (defined in pub. 946) placed in service before January 1, 2012. Any qualified restaurant property (defined in pub. 946) placed in service before January 1, 2012. Initial clearing and grading land improvements for gas utility property. Electric transmission property (that is section 1245 property) used in the transmission at 69 or more kilovolts of electricity placed in service after April 11, 2005. See Natural gas gathering line, natural gas distribution line, and electric transmission property, later. Any natural gas distribution line placed in service after April 11, 2005. See Natural gas gathering line, natural gas distribution line, and electric transmission property, later. Any qualified retail improvement property placed in service before January 1, 2012. Farm buildings (other than single purpose agricultural or horticultural structures). Municipal sewers not classified as 25-year property. Initial clearing and grading land improvements for electric utility transmission and distribution plants.
5-year
7-year
10-year
15-year
20-year
Page 1
31.5-year
Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21
Table A-1 from IRS Publication 946 (2010) Depreciation rate for recovery period (decimal format)
3-year 5-year 7-year 10-year 15-year 20-year
.1000 .1800 .1440 .1152 .0922 .0737 .0655 .0655 .0656 .0655 .0328
.0500 .0950 .0855 .0770 .0693 .0623 .0590 .0590 .0591 .0590 .0591 .0590 .0591 .0590 .0591 .0295
.03750 .07219 .06677 .06177 .05713 .05285 .04888 .04522 .04462 .04461 .04462 .04461 .04462 .04461 .04462 .04461 .04662 .04661 .04462 .04461 .02231
Page 2
Systematic Instructions Always start with the three-line header, which in this case includes the name of the corporation, the title of the form, and the assets useful life. 1. On the first line place the title Cost of Asset and then the dollar value of the asset. 2. On the second line place the title Residual Value and the dollar value of the asset at the end of its useful life to the corporation. 3. On the third line place the title Useful Life and the amount of years the asset will be of value to the corporation. You can use the first two charts to determine what the useful life of the asset will be for the corporation. Please take note that an asset does not cease to exist just because it is no longer useful to the corporation. 4. On the fourth line label the columns alphabetically. 5. On the fifth line use the following labels:
Depreciation Rate Annual Depreciation Expense Accumulated Depreciation Book Value At end of year
End of year
Cost
Page 3
Page 4