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A simplified GDS picture for residential rental real property: 27.5 years, straight line, mid-month, building basis only. Land stays out. This is not a cost-segregation study.
Year-1 depreciation with a short-life split is on the cost segregation worksheet.
Three layers stay separate: Market context does not set basis · Cash flow is a different worksheet · Tax education (this mid-month illustration). No blended after-tax return from live FMR.
Estimates for planning; not tax/legal advice.
Inputs. Depreciable building basis; placed-in-service month and year; optional land value.
Formulas. Full-year amount = basis ÷ 27.5. First-year fraction under the mid-month convention = (12.5 − month) ÷ 12. First-year amount = full-year × that fraction. Land is not depreciated.
Assumptions. Residential rental real property, GDS, straight line, mid-month. No bonus depreciation test for used residential buildings. No 2026 cost-segregation percentages. Cost segregation, listed property, and qualified improvement property are out of scope except: ask a CPA.
Year warning. Years outside 1987-2027 get a reasonableness warning, not a hard stop.