Depreciation Methods Comparison
Compare straight-line, MACRS, and double-declining depreciation side by side.
By Konstantin Iakovlev · Updated September 2026 · Source: IRS — Publication 946, How To Depreciate Property
Straight-Line Annual
$20,000.00
Year-by-Year Comparison
| Year 1 | SL: $20,000.00 | DDB: $40,000.00 | MACRS: $20,000.00 |
| Year 2 | SL: $20,000.00 | DDB: $24,000.00 | MACRS: $32,000.00 |
| Year 3 | SL: $20,000.00 | DDB: $14,400.00 | MACRS: $19,200.00 |
| Year 4 | SL: $20,000.00 | DDB: $8,640.00 | MACRS: $11,520.00 |
| Year 5 | SL: $20,000.00 | DDB: $5,184.00 | MACRS: $11,520.00 |
Use the Depreciation Methods Comparison above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
Different depreciation methods spread an asset's cost across its life in very different shapes, and this tool lets you set them side by side to see how the value comes down over time. The choice is not just academic: it ripples through your financial statements, your tax bill, and ultimately how profitable the business looks, because it governs how and when the asset's cost lands as an expense.
At its core, depreciation is the systematic way accounting allocates the cost of a tangible asset over the years it stays useful. It is worth being clear about what it does not do: depreciation says nothing about what the asset would fetch on the open market. It exists purely to recognize the asset as an expense for accounting and tax purposes.
In book depreciation, two inputs drive the result more than any others: the asset's useful life and its salvage value. This calculator takes cost and useful life only and assumes no salvage value, as MACRS does for tax purposes; for straight-line book depreciation with a salvage value, enter the cost minus the salvage value. It is also tempting to pick whichever method delivers the biggest near-term tax break, but a method chosen for tax reasons alone can distort the earnings you report, so weigh both sides before committing.
Example: Straight-Line vs. Double-Declining Balance vs. MACRS for a $100,000 Machine
- 1 Input: Asset Cost = $100,000, Useful Life = 5 years. The calculator assumes no salvage value.
- 2 Straight-Line: $100,000 / 5 = $20,000 a year. Double-Declining Balance applies twice the straight-line rate, 2/5 = 40%, to the remaining book value: $40,000 in year 1, then 40% × $60,000 = $24,000 in year 2.
- 3 MACRS for 5-year property (half-year convention, IRS Publication 946 Table A-1): 20% × $100,000 = $20,000 in year 1 and 32% × $100,000 = $32,000 in year 2.
- 4 Takeaway: over the first two years straight-line deducts $40,000, MACRS $52,000 and double-declining balance $64,000. The faster methods front-load the deductions and leave less for later years, which can mean larger tax deductions early but lower reported income in those years.
Source: IRS — Publication 946, How To Depreciate Property · Last updated: September 2026
Frequently Asked Questions
Which depreciation method gives the biggest tax deduction early on?
When should I use straight-line depreciation?
What is the MACRS recovery period for common assets?
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