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Project a vehicle's value year-by-year. New cars drop ~20% in year one, then ~15%/year after. Adjust for vehicle type, mileage and condition, see trade-in vs. private-sale value, and estimate business tax depreciation.
| Year | Value | Lost that year | Cumulative loss |
|---|---|---|---|
| Year 1 | $28,000.00 | $7,000.00 | $7,000.00 |
| Year 2 | $23,800.00 | $4,200.00 | $11,200.00 |
| Year 3 | $20,230.00 | $3,570.00 | $14,770.00 |
| Year 4 | $17,195.50 | $3,034.50 | $17,804.50 |
| Year 5 | $14,616.18 | $2,579.33 | $20,383.83 |
Year 1: value × (1 − year1%). Subsequent years: prior year × (1 − yearN%). We apply this recursively for the number of years you set.
Tier presets fill in starting rates (Economy 18/13, Mainstream 20/15, Near-Luxury 23/16, Luxury 26/17, Ultra-Luxury 30/18, Truck/SUV 16/12, EV 28/18); editing a rate switches back to Custom.
Adjusted value = base value × (1 + mileage adj.) × condition multiplier. Mileage adj. = −(annual miles − 13,500) × age ÷ 1,000 × 0.4%, capped ±20%. Condition: Outstanding ×1.08, Clean ×1.03, Average ×1.00, Rough ×0.88, Damaged ×0.70. At the defaults (13,500 mi/yr, Average) both are neutral.
Value today uses fractional age t = years + months/12: t ≤ 1 → price × (1 − y1)^t; otherwise price × (1 − y1) × (1 − yN)^(t−1).
Cost per mile = total depreciation ÷ (annual miles × years). Trade-in = private value × (1 − dealer discount).
MACRS = basis × business-use % × IRS 5-year half-year percentages. Rate-based estimate only — no VIN or live market data.
The moment a car is titled, it moves from 'new' to 'used' in the market, which is a major price tier drop.
Four big drivers: age (the steepest drop is year one), mileage (wear and remaining life), condition (damage, accidents, upkeep), and make/model tier (luxury and EVs typically fall faster; trucks and popular SUVs hold value best). Industry data (iSeeCars/Progressive) puts the average 5-year loss around 38.8% — that's an industry average, not this tool's output.
It's a common rule of thumb for a mainstream new car. Real results vary widely by model — use the tier presets or your own rates if you know your model's history.
This tool compares your total miles with a 13,500 mi/yr baseline for the car's age and adjusts value by 0.4% per 1,000 miles over (penalty) or under (bonus), capped at ±20%. It's an estimate, not a market lookup.
Dealers need margin to recondition, hold and resell your car, and they carry the risk. Trade-ins typically bring roughly 85–90% of private-sale value, in exchange for convenience and (in many states) a sales-tax credit.
MACRS is the IRS depreciation system for business property. Vehicles are 5-year property (20%, 32%, 19.2%, 11.52%, 11.52%, 5.76%). You only need it if you use the vehicle for business and deduct actual expenses instead of the standard mileage rate.
Toyota, Honda, and select trucks (Tacoma, 4Runner) historically hold value best. Luxury sedans depreciate fastest.
Yes — traditionally faster, but the gap is narrowing. Tesla resale in particular has been closer to gas peers.
For personal vehicles, no. For business use, yes — via MACRS or the standard mileage deduction.
Leasing doesn't avoid depreciation — you pay for it in the monthly payment. It just spreads it evenly.
Results are estimates for educational purposes only and are not financial advice. Verify with a qualified professional before making decisions.
Last updated October 2026