MACRS Indian Reservation Conventions

This method uses the same averaging conventions as the other MACRS methods: half-year for personal property and mid-month for real property, with the exception of leasehold improvements as explained below.

The MACRS recovery allowance under the MI method is substantially equivalent to the allowance under the formula method. As with the MACRS formula calculation, the MACRS Indian Reservation method allows either a 200% or 150% rate (declining-balance) with a switch to straight-line at the optimal point for personal property, and a 100% rate (straight-line) for real property. Also, real property in the 15- or 20-year property class can use the 150% declining-balance rate.

If the property is a leasehold improvement placed in service after 10/22/2004 and before 1/1/2018, the half-year convention is used, and you must depreciate it over a 9-year period using the straight-line method of depreciation. (If you elect alternative MACRS straight-line depreciation, use method AD with the appropriate Indian Reservation life.)

The only actual difference between method MI and method MF is that method MI allows the property to be depreciated over shorter recovery periods.

Property Class	Recovery Period
3-year	2 years
5-year	3 years
7-year	4 years
10-year	6 years
15-year	9 years
20-year	12 years
Nonresidential real property (39-years)	22 years