Depreciation Calculator
Calculate yearly depreciation with the straight-line, double declining balance or sum-of-the-years digits method and see the full schedule.
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About the Depreciation Calculator
Depreciation spreads the cost of an asset over its useful life. This calculator uses three common accounting methods: straight-line (equal yearly amounts), double declining balance (faster early depreciation) and sum-of-the-years digits (declining amounts). It shows a yearly schedule with accumulated depreciation and book value. Tax depreciation, such as MACRS, follows different IRS rules.
How to use it
- Enter the asset cost, expected salvage value and useful life in years.
- Choose a depreciation method.
- Press Calculate depreciation to see the yearly schedule.
Why depreciation matters
Depreciation matches the cost of a long-lived asset, such as a vehicle, machine or building, with the years it helps earn income. It lowers reported profit each year without a cash payment, and it appears on the balance sheet as accumulated depreciation. Businesses and landlords use it for budgeting, pricing and tax planning.
Depreciation formulas
- Straight-line = (cost − salvage value) ÷ useful life
- Double declining balance = book value × (2 ÷ useful life)
- Sum-of-the-years digits = (cost − salvage) × remaining life ÷ sum of years
Which method to use
| Method | Best for |
|---|---|
| Straight-line | Assets that wear evenly over time |
| Double declining balance | Assets that lose value fastest early, like vehicles and equipment |
| Sum-of-the-years digits | Accelerated depreciation with a gradual decline |
Frequently asked questions
How do you calculate depreciation?
For straight-line, subtract the salvage value from the cost and divide by the useful life in years.
What is salvage value?
The estimated value of an asset at the end of its useful life.
What is the difference between book and tax depreciation?
Book depreciation follows accounting methods. Tax depreciation follows IRS rules such as MACRS and may allow faster write-offs.
Can I depreciate land?
No. Land is not depreciated, but buildings on it are.
What is double declining balance?
An accelerated method that doubles the straight-line rate and applies it to the remaining book value each year.
Last reviewed: November 2026. Estimates only, not financial, tax or legal advice.