Asset Depreciation Calculator

Calculate asset value over time using Straight Line, Declining Balance, or Sum-of-Years' Digits methods. Ideal for accounting and tax estimation.

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About

Depreciation is the systematic allocation of the cost of a tangible asset over its useful life. For businesses, choosing the right depreciation method is crucial for financial reporting and tax strategy. This Depreciation Calculator compares the three most common methods side-by-side.

Use Straight Line for consistent write-offs, or Double Declining Balance if the asset loses value rapidly in early years (like technology or vehicles). This tool generates a full schedule, showing the beginning book value, depreciation expense, and ending book value for every year of the asset's life.

depreciation accounting tool straight line declining balance

Formulas

1. Straight Line (SL):

Expense = Cost − SalvageLife

2. Double Declining Balance (DDB):

Expense = (2Life) × BookValuestart

3. Sum of Years' Digits (SYD):

Expense = (Cost − Salvage) × RemainingLifeSumOfDigits

Reference Data

Asset Class (IRS MACRS GDS)Recovery PeriodExamples
3-Year Property3 YearsTractor units, racehorses, specialized tools.
5-Year Property5 YearsAutomobiles, taxis, computers, office machinery.
7-Year Property7 YearsOffice furniture, fixtures, agricultural machinery.
10-Year Property10 YearsVessels, barges, tugs, fruit trees.
15-Year Property15 YearsLand improvements, shrubbery, fences.
Residential Rental27.5 YearsRental houses, apartments.
Commercial Property39 YearsOffice buildings, warehouses.

Frequently Asked Questions

Salvage value (or residual value) is the estimated resale value of the asset at the end of its useful life. The asset is not depreciated below this amount.
Straight Line is the simplest and most common for standard reporting. Accelerated methods (like DDB) are used when assets are more productive in early years or to reduce tax liability sooner.
Book value is the original cost of the asset minus the accumulated depreciation to date. It represents the asset's current value on the balance sheet.
This calculator uses standard GAAP accounting formulas (SL, DDB, SYD). MACRS (Modified Accelerated Cost Recovery System) is a specific US tax code method that uses statutory tables and is not fully covered by general DDB formulas.