Depreciation Calculator
Depreciate any asset with five standard accounting methods: straight-line, 150% or 200% declining balance (with automatic switch to straight-line), sum-of-the-years’-digits, or units-of-production. Get a full year-by-year schedule for whichever method you choose.
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Every depreciation method allocates the exact same total amount — cost minus salvage value — over an asset’s useful life; only the timing changes. Straight-line is the simplest: an equal deduction every year. Declining balance and sum-of-the-years’-digits are “accelerated” methods that front-load larger deductions into the early years, which better matches assets that lose value or usefulness fastest when new — vehicles and technology being classic examples. Units-of-production ties the deduction to actual usage instead of the calendar, so a slow year produces a smaller write-off and a heavy-use year produces a larger one.
How it’s calculated
Straight-line: (cost − salvage) ÷ life, every year. Declining balance: book value × (factor ÷ life) each year, switching to straight-line on the remaining book value the first year that produces a larger deduction, and never depreciating below salvage value. Sum-of-the-years’-digits: (cost − salvage) × (years remaining ÷ sum of 1..life). Units-of-production: (cost − salvage) ÷ total estimated units × units produced that year. The partial-first-year option prorates year one by the % of the year the asset was in service, with the leftover spilling into one additional final year.
Results update as you type and are general accounting estimates, not tax advice — consult a tax professional for the depreciation method and convention required for your specific asset class.
Year-by-year depreciation schedule
Shows depreciation, accumulated depreciation, and book value for each year under your selected method.
Worked example
A $40,000 asset with a $4,000 salvage value and an 8-year useful life, depreciated straight-line, deducts a flat $4,500 every year until it reaches salvage value. The same asset under 200% declining balance deducts $10,000 in year one (25% of cost) and $7,500 in year two, tapering off from there. With a shorter life and a lower factor — say a 150% declining balance asset with no salvage value over 7 years — the method switches to straight-line partway through: years 1–3 use declining balance, then years 4–7 lock into an equal $6,063.23 straight-line deduction once that exceeds the shrinking declining-balance amount.
Common mistakes
- Forgetting that declining balance methods ignore salvage value in the rate calculation itself — the calculator only enforces the floor at the end, so the book value can approach but shouldn’t drop below salvage.
- Using a depreciation factor of 2 in the dropdown for “150% declining balance” — the factor should match the method (1.5 for 150%, 2.0 for 200%/double-declining).
- Mismatching the units-of-production total against the actual sum of yearly units entered, which causes the asset to fully depreciate earlier or later than the stated useful life.
Where it is used
- Small business and self-employed tax filings that require reporting depreciation on business equipment.
- Financial modeling and forecasting for capital expenditure decisions.
- Comparing how fast an asset's book value declines under different accounting policies before choosing one.
Frequently asked questions
Do all methods depreciate the same total amount?
Yes — every method depreciates exactly cost minus salvage value over the asset's life. Only the timing changes: accelerated methods (declining balance, sum-of-years-digits) front-load the deduction into early years, while straight-line spreads it evenly.
Why does 200% declining balance switch to straight-line?
Declining balance depreciation shrinks every year, so late in an asset's life it can produce a smaller deduction than simply spreading the remaining book value evenly over the remaining years. Standard practice switches to straight-line the first year that would produce a larger write-off, ensuring the asset still fully depreciates to salvage value by the end of its life.
What depreciation factor should I use for double-declining balance?
Double-declining balance is simply 200% (a factor of 2) declining balance — the most common accelerated method. A factor of 1.5 (150%) declines more gently and is sometimes required for certain asset classes under U.S. tax rules; check current IRS guidance for which factor applies to your asset type.
When should I use units-of-production instead of a time-based method?
When an asset's wear tracks usage rather than the calendar — manufacturing equipment, vehicles measured by mileage, or machinery with a rated output capacity. It ties the deduction directly to actual units produced each year instead of assuming a fixed yearly pattern.
What does the partial first-year option do?
It prorates the first year's depreciation by the percentage of the year the asset was actually in service — for example, an asset placed in service halfway through the year gets 50% of a full year's deduction in year one, with the leftover half-year's worth of depreciation spilling into an additional final year.