Recovery Periods Under GDS

Under GDS, property is depreciated over one of the following recovery periods.

Property Class Recovery Period

3-year property . . . . . . . . . . . . . . . 3 years ¹

5-year property . . . . . . . . . . . . . . . 5 years 7-year property . . . . . . . . . . . . . . . 7 years 10-year property . . . . . . . . . . . . . . 10 years 15-year property . . . . . . . . . . . . . . 15 years ²

20-year property . . . . . . . . . . . . . . 20 years

32 Chapter 4 Figuring Depreciation Under MACRS Publication 946 (2025)

25-year property . . . . . . . . . . . . . . 25 years ³

Residential rental property . . . . . . 27.5 years Nonresidential real property . . . . . 39 years ⁴

1 5 years for qualified rent-to-own property placed in service before August 6, 1997.

2 39 years for property that is a retail motor fuels outlet placed in service before August 20, 1996 (31.5 years if placed in service before May 13, 1993), unless you elected to depreciate it over 15 years.

3 20 years for property placed in service before June 13, 1996, or under a binding contract in effect before June 10, 1996.

4 31.5 years for property placed in service before May 13, 1993 (or before January 1, 1994, if the purchase or construction of the property is under a binding contract in effect before May 13, 1993, or if construction began before May 13, 1993).

The GDS recovery periods for property not listed above can be found in Appendix B, Table of Class Lives and Recovery Periods. Residential rental property and nonresidential real property are defined earlier under Which Prop- erty Class Applies Under GDS .

Enter the appropriate recovery period on Form 4562 under column (d) in Section B of Part III, unless already shown (for 25-year property, residential rental property, and nonresidential real property).

Office in the home. If your home is a personal-use single family residence and you begin to use part of your home as an office, depreciate that part of your home as nonresidential real property over 39 years (31.5 years if you began using it for business before May 13, 1993). However, if your home is an apartment in an apartment building that you own and the building is residential rental property, as defined earlier under Which Property Class Applies Under GDS , depreciate the part used as an office as residential rental property over 27.5 years. See Pub. 587 for a discussion of the tests you must meet to claim expenses, including depreciation, for the business use of your home.

Home changed to rental use. If you begin to rent a home that was your personal home before 1987, you depreciate it as residential rental property over 27.5 years.