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Car depreciation calculator
Type the price, a yearly loss rate and the years you plan to keep the car: the table shows its value at the end of each year, and the tax side for business miles.
Published by Radif Partners · Rules and data · Editorial policy
Estimated value after 5 years
$15,973
$20,027 lost · 15.0% a year
| End of year 1 | $30,600 |
| End of year 2 | $26,010 |
| End of year 3 | $22,109 |
| End of year 4 | $18,792 |
| End of year 5 | $15,973 |
| Tax basis reduction per year at 35 cents a business mile (2026) | $2,800 |
With the standard mileage rate, part of each mile counts as depreciation and lowers the car's tax basis (Notice 2026-10): 26¢ in 2022, 28¢ in 2023, 30¢ in 2024, 33¢ in 2025, 35¢ in 2026. How this is calculated.
A $36,000 car that loses 15% of its value every year is worth about $15,973 after five years, a loss of $20,027; at 20% a year it falls to $11,796. The calculator above applies the rate you choose to the value left at the start of each year, which is how used-car prices usually behave: the biggest drop in dollars comes first. The rate itself is your assumption. No federal agency publishes an official depreciation table for private cars, and this site will not invent an average; check what cars like yours, a few years older, sell for and use the rate that matches. The tax side is official: if you deduct business driving with the IRS standard mileage rate, 35 cents of each 2026 business mile counts as depreciation and lowers the car's basis, 33 cents in 2025 and 30 in 2024.
Market value and tax depreciation are two different things
Market depreciation is what you lose when you sell: the gap between the price you paid and the price a buyer offers. It depends on the model, the mileage, the condition and the market of the moment, and it is what the yearly rate in the calculator describes. Tax depreciation is an accounting rule for a car used in a business, and it follows the tax code, not the market. The two rarely match, and for a car used only privately, tax depreciation does not exist.
The depreciation inside the standard mileage rate
A self-employed person who deducts business miles at the standard rate does not claim depreciation separately, but part of each mile is treated as depreciation all the same. Notice 2026-10 sets that part at 26 cents for 2022, 28 cents for 2023, 30 cents for 2024, 33 cents for 2025 and 35 cents for 2026. The car's basis (roughly what you paid) goes down by that amount per business mile, never below zero. With 9,000 business miles a year from 2024 to 2026, the basis falls by $8,820. When the car is sold, the gain is computed on the reduced basis, so a car "sold at a loss" in market terms can produce a taxable gain on its business part.
What a mile is worth in 2026
Value from July 1, 2026
$380
| 500 mi × $0.76 (from July 1) | $380 |
| 500 mi × $0.725 (Jan. 1 to June 30) | $362.50 |
| Difference | $17.50 |
Actual-cost depreciation, in one paragraph
A business owner who deducts actual car costs depreciates the business share of the car under the tax rules for vehicles, with yearly caps for passenger cars and special elections such as section 179 or bonus depreciation. Choosing any of them closes the door to the standard mileage rate for that car for good (Publication 463). Those computations need the purchase date, the business share each year and the caps of each year; this calculator does not perform them. The business mileage deduction calculator compares the two methods once you have the actual-cost figure.
Using the result
The yearly loss in dollars is a fixed cost of owning the car. Enter it in the cost per mile calculator to see what it adds to each mile, or in the cost of ownership calculator with insurance and fuel. If you plan to sell after a few years, the end-of-year values give you a target price; if you keep cars until they wear out, the loss of value matters less than repairs and fuel.
Picking a rate honestly
Look up the asking prices of the same model one, three and five years older with similar miles, divide each by the new price, and see which yearly rate reproduces them. Electric cars, luxury cars and work trucks follow different curves, and a single model can swing with fuel prices or a new generation. A rate that fits your car beats any national average, even a sourced one.