Depreciation Calculator — Straight Line MACRS Method
Calculate asset depreciation using straight-line, declining balance, or sum-of-years-digits methods.
How to use this calculator
👉 Fill in the boxes below and your answer appears instantly — no maths needed, we do it all for you! 🎉
In plain English — what does this do?
💵 A money helper! It works out things like how much to save, how much you owe, or how much you’ll have in the future. Just fill in the boxes and you’ll get your answer.
A depreciation calculator determines how much value an asset loses over time using different accounting methods. Straight-line depreciation spreads cost evenly over the asset's life. Declining balance front-loads depreciation. Sum-of-years-digits is an accelerated method between the two. Businesses use depreciation to match expenses with the revenue assets generate.
Year 1 Depreciation
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Book Value After Year 1
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Accumulated (Half Life)
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What is Depreciation Calculator — Straight Line MACRS Method?
A depreciation calculator determines how much value an asset loses over time using different accounting methods. Straight-line depreciation spreads cost evenly over the asset's life. Declining balance front-loads depreciation. Sum-of-years-digits is an accelerated method between the two. Businesses use depreciation to match expenses with the revenue assets generate.
How to use it
- 1️⃣ Enter the asset's original cost.
- 2️⃣ Enter the salvage value (estimated worth at end of useful life).
- 3️⃣ Enter the useful life in years.
- 4️⃣ Select a depreciation method.
- 5️⃣ Review annual depreciation, first-year book value, and accumulated depreciation at the midpoint.
Formula
💡 See it in action — a real example
❓ Common questions
- What is salvage value?
- Salvage value (also called residual value) is the estimated amount you could sell the asset for at the end of its useful life. It reduces the total depreciable amount. If you expect to dispose of the asset with no value, salvage is $0.
- Which method should I use?
- Straight-line is simplest and most common for financial reporting. Declining balance (double declining) is preferred for assets that lose value quickly early on (vehicles, computers). SYD is a middle-ground accelerated method.
- What is MACRS?
- Modified Accelerated Cost Recovery System is the IRS-required depreciation method for US tax purposes. It uses specific recovery periods and conventions not covered here. Consult IRS Publication 946 or a tax advisor for tax depreciation.
- Does depreciation affect cash flow?
- Depreciation is a non-cash expense — it reduces taxable income without requiring a cash outlay in the current period. This creates a tax shield that improves actual cash flow relative to reported income.
- What is book value?
- Book value is the asset's recorded value on the balance sheet — original cost minus accumulated depreciation. It does not necessarily reflect market value, which depends on supply, demand, and condition.