Rental Property Depreciation Calculator — CCA (Canada) & MACRS (US)
Calculate your annual depreciation deduction for a rental property. Canadian investors: get your CCA (Class 1, 4% declining balance). US investors: get your MACRS straight-line deduction over 27.5 years. Free.
In Canada, rental property buildings are depreciated under the Capital Cost Allowance (CCA) system — most residential buildings use Class 1 at 4% declining balance. In the US, residential rental property depreciates over 27.5 years straight-line under MACRS. Enter your building value (excluding land) to see your annual CCA/depreciation deduction and its tax impact at your marginal rate.
Select your region for jurisdiction-specific rules (deposit caps, rent increase limits, transfer taxes, and more).
Inputs
Exclude land value — only the building depreciates
Results
Year 1 Deduction
$0
10-Year Total Deduction
$0
Depreciation Method
CCA Class 1 (4% declining balance, half-year rule)
Book Value After N Years
$300,000
Understanding This Calculator
Learn how rental buildings are depreciated for tax purposes — declining-balance CCA in Canada versus straight-line MACRS in the US — and what the deduction is worth.
How the math works
Only the building depreciates — land never does, so the land portion of your purchase price is excluded first.
Canada (CCA): most residential rental buildings fall in Class 1 at a 4% declining-balance rate: deduction = undepreciated capital cost × 4%, with the half-year rule cutting the first year's claim in half. Each year's claim shrinks slightly because the base declines. CCA is optional each year and cannot create or increase a rental loss.
US (MACRS): residential rental property depreciates straight-line over 27.5 years: deduction = building cost ÷ 27.5, the same amount every full year (39 years for commercial).
Worked example
Using the default building value of $300,000 (land already excluded):
- Canada: Year 1 = 300,000 × 4% × ½ = $6,000; Year 2 = (300,000 − 6,000) × 4% = $11,760; each later year is slightly less as the balance declines.
- US: 300,000 ÷ 27.5 = $10,909 per year, every year.
At a 40% marginal tax rate, the Canadian Year 2 claim defers about $4,700 of tax; the US annual deduction defers about $4,364. Over 10 years the calculator totals the accumulated deductions and remaining book value for your inputs.
How to read the result
Depreciation is a deferral, not free money. In Canada, claimed CCA is recaptured as fully taxable income when you sell for more than the depreciated value; in the US, depreciation is recaptured at up to 25%. The deduction is most valuable when your current tax rate is high and you expect a long hold.
Two Canadian cautions: CCA cannot be used to create a rental loss, and claiming CCA on a property that is partly your principal residence can jeopardize the principal-residence exemption. Splitting land from building value is itself a judgment call the CRA or IRS can challenge. This is a planning estimate — confirm your claim with a tax professional.