Short answer: record each GPU server, or each group of identical servers, at its cost. Pick a useful life and a salvage value, and spread the cost minus salvage evenly over that life. Each month, debit depreciation expense and credit accumulated depreciation. When a server or a card is sold, scrapped or swapped out, take its cost and accumulated depreciation off the books and record the gain or loss.
1. Work out what each server cost
Start with the purchase price of the server and the GPUs in it. Costs you paid to get it running are usually added, such as shipping, import duties and installation. Running costs are not part of the machine's cost. Power, internet, rack space and marketplace fees are monthly expenses.
Record identical servers bought together for one site as one group, for example four 8-GPU servers of the same model. If you build your own machines, keep the GPU invoices with the rest of the parts, because cards are often the part that gets replaced or resold first.
2. Choose a useful life
The useful life is how long you expect a server to earn. Large public companies that run GPUs disclose the lives they use for their own fleets:
- CoreWeave depreciates technology equipment over six years on a straight-line basis, and moved its data center computing equipment from five to six years from January 1, 2023 (Form 10-K for 2025).
- Meta raised the estimated useful life of most servers and network assets to 5.5 years from January 1, 2025 (Form 10-K for 2025).
- Amazon lists servers and networking equipment at five to six years, and shortened the life of a subset of its servers and networking equipment from six to five years from January 1, 2025 (Form 10-K for 2025).
Those are estimates for data center fleets, and the companies do not all agree. Consumer cards rented out around the clock, used hardware, or a model you expect renters to move away from can all point to a shorter life. Agree the life with your accountant and write down why.
3. Calculate the monthly charge
Straight-line depreciation spreads the cost evenly:
Monthly depreciation = (cost minus salvage value) divided by useful life in months
Salvage value is what you expect to get for the hardware at the end of its life. Used GPUs do resell, but prices for older models are hard to predict, so zero or a conservative figure is the cautious choice.
Example. You buy two GPU servers for $15,000 each, $30,000 in total, and put them into service in March. You use a 48-month life and no salvage value. The monthly charge is $30,000 divided by 48, which is $625.00. Depreciation starts in the month the servers start earning, not the month you paid for them.
4. Book the monthly journal entry
Each month, for each group or as one total:
- Debit Depreciation expense $625.00
- Credit Accumulated depreciation $625.00
Accumulated depreciation is a contra asset account that sits under your computer equipment. Cost minus accumulated depreciation is the servers' book value. If you track sites or machine groups in QuickBooks with classes or locations, tag the entry so profit by site includes it.
5. Keep a fleet register
A fleet register is the list behind the entries. For each server or group keep:
- server model, GPU model and number of GPUs
- site
- number of units and total cost
- in-service date
- useful life and salvage value
- depreciation to date and book value
- any cards or servers added, swapped, sold or scrapped, with dates
Update it when hardware changes, before you close the month. The register is what your accountant checks the entries against. If you host on Vast.ai, the same register can map each machine ID to a site, as in how to track Vast.ai payouts per machine and per site.
6. Handle GPU swaps, sales and scrapped servers
GPU hosts change hardware more often than most. A card you add to a server later, or swap in for a failed one, is usually recorded as its own item with its own cost and in-service date. A card or server that leaves is removed from the books with its accumulated depreciation, and any cash received is recorded. The difference is a gain or a loss.
Example. After 18 months you sell one of the two servers for $9,000. Its cost was $15,000. Its depreciation to date is $15,000 divided by 48, times 18, which is $5,625. Book value is $9,375, so the sale is a $375 loss:
- Debit Cash $9,000
- Debit Accumulated depreciation $5,625
- Debit Loss on disposal $375
- Credit Computer equipment $15,000
From the next month, the charge drops to $312.50 for the server that is left. Ask your accountant how to treat a repair that only keeps a server running, compared with an upgrade that extends its life.
7. Put depreciation into your hourly profit
Hosts usually think in earnings per hour. Depreciation belongs in that view too. In the example, one server's $312.50 a month is about $0.43 for each of the roughly 730 hours in a month, whether the machine was rented or not. Look at profit in two layers:
- Cash: earnings minus power, internet, rack space and other running costs.
- Fully loaded: the same, minus depreciation.
Whether to keep a machine listed this month is a cash question. Whether it earns back what you paid for it is a fully loaded question. If your machines sit idle for part of the month, the fully loaded cost per rented hour goes up. For the full per-GPU formula and break-even utilization, see GPU hosting profitability per GPU.
Book depreciation and tax depreciation
Everything above is book depreciation, for your own accounts and anyone who reads them. Tax depreciation follows separate rules and can give a very different schedule for the same servers. For US tax, IRS Publication 946 lists computers and peripheral equipment as 5-year property under MACRS, and the section 179 deduction and bonus depreciation may also be available. Which rules apply is a call for your accountant. For the records GPU hosts keep for tax, see GPU rental income and taxes.
Doing it every month with Flash
Flash keeps the fleet register for compute operators: record the GPU equipment cost, in-service date and useful life, and Flash includes scheduled book depreciation in the monthly close and prepares journal entries for you to review before they post to QuickBooks. You see profit by site and machine group, and a site that runs ASIC miners and GPU servers side by side shares one set of books.
For the income side, Flash lists each payout Vast.ai reports. When the money lands, confirm it with the date and reference, and Flash keeps it in your audit history. See the Vast.ai connection, in early access, and how Vast.ai host payouts work. If you host GPUs, see Flash for GPU operators. If you also mine, how to depreciate ASIC miners covers the same steps for miners, and Flash for miners shows the rest. If an accountant keeps your books, see Flash for Accountants.
Questions
What useful life should I use for GPU servers?
There is no single rule. In their latest annual reports CoreWeave uses six years for technology equipment, Meta uses 5.5 years for most servers and Amazon uses five to six years for servers. Consumer cards rented around the clock may warrant a shorter life. Agree it with your accountant and write down why.
How do I calculate monthly depreciation for a GPU server?
Take the cost minus the expected salvage value and divide it by the useful life in months. Two servers costing $30,000 in total over 48 months with no salvage value come to $625.00 a month.
What is the journal entry for GPU depreciation?
Debit depreciation expense and credit accumulated depreciation for the month's charge. Tag the entry with the site or machine group if you track profit that way.
How do I record adding or replacing a GPU in a server?
A GPU you add or swap in is usually recorded as its own item with its own cost and in-service date. A card you take out is removed from the books with its accumulated depreciation, like any disposal. Agree the treatment with your accountant.
Is book depreciation for GPUs the same as tax depreciation?
No. For US tax, IRS Publication 946 lists computers and peripheral equipment as 5-year property, and other elections may apply. Your book schedule can use a different life. Your accountant decides which rules apply.
Should depreciation be part of my hourly GPU profit?
Look at both. Earnings minus power and running costs tells you whether renting a machine this month pays. Adding depreciation tells you whether the machine earns back what it cost.
General information, not accounting or tax advice. Flash is the CFO layer for compute operators: Bitcoin miners and GPU hosts. See Flash for GPU operators.