To calculate depreciation correctly, you have to choose between the IRS's General Depreciation System and Alternative Depreciation System. In most cases you use the GDS. However, some property -- like property used mostly outside the United States -- has to be depreciated using the alternative system.
If you use GDS, you have to classify your property. Computers are in the five-year class, for instance, while office furniture is in the seven-year class. If you buy a new desk, for example, you'd depreciate the value over the following seven years. There are also different conventions used to establish when depreciation for the first year starts. The half-year convention, for instance, assumes depreciation starts at mid-year.
Publication 946 includes tables to help you figure depreciation. For instance, on a five-year property under the half-year convention you deduct 20 percent of the value the first year. On a $2,000 piece of equipment, that's $400. The second year you deduct 32 percent, the third year it's 19.2 percent. Given the different systems and conventions, it may take a tax pro to figure which ones you can use and which gives the best tax break.