NPV (Net Present Value) is the difference between the present value of cash inflows and outflows over a period of time, calculated in US dollars. To calculate NPV: (1) List all cash flows including initial investment and future inflows. (2) Select your discount rate—typically your company's WACC or required return (8-15% for most US businesses). (3) Discount each future cash flow to present value by dividing by (1 + rate)^period. For example, $50,000 in Year 2 at 10% discount = $50,000 / (1.10)² = $41,322. (4) Sum all discounted cash flows. (5) Subtract initial investment. If NPV > $0, accept the project. Our free NPV calculator above automates this for US businesses across all 50 states, accounting for federal and state tax implications.

The net present value formula is: NPV = Σ [CFt / (1 + r)^t] - Initial Investment, where CFt is the cash flow at time t, r is the discount rate (expressed as a decimal), t is the time period, and Σ represents the sum from period 1 to n. Alternatively written as: NPV = -C₀ + C₁/(1+r) + C₂/(1+r)² + C₃/(1+r)³ + ... + Cₙ/(1+r)ⁿ. This NPV equation is used universally across US corporations, from Silicon Valley startups to Wall Street firms. The formula accounts for the time value of money—the principle that a dollar today is worth more than a dollar tomorrow. For US tax purposes, use after-tax cash flows by multiplying pre-tax amounts by (1 - tax rate), where tax rate combines federal (21%) and state rates (0-11.5%).

To find NPV using our calculator: (1) Enter your initial investment in US dollars (the upfront cost or capital expenditure). (2) Input your discount rate as a percentage—use your WACC, required return, or hurdle rate (typically 8-15% for US companies). (3) Add expected cash inflows for each year—our calculator starts with 3 years but you can add up to 20 years using the "Add Another Year" button. (4) Click "Calculate NPV" for instant results with detailed breakdowns showing present value of each cash flow. Our NPV solver handles all mathematical calculations automatically, applying the net present value equation and providing interpretation for decision-making. For US businesses, consider using after-tax cash flows by accounting for your combined federal (21%) and state corporate tax rate for accurate NPV analysis across all 50 states.

Net present worth and net present value are the same concept with identical calculations—they're interchangeable terms. Both measure the difference between the present value of benefits (cash inflows) and costs (cash outflows). The term "net present worth" is commonly used in engineering economics, public sector projects, infrastructure planning, and cost-benefit analysis across US government agencies. "Net Present value" is more common in corporate finance, investment banking, and business school curricula. Regardless of terminology—NPV, NPW, or present worth—the calculation method (sum of discounted cash flows minus initial investment) remains constant. Use our net present worth calculator above for any NPV/NPW calculation across all US applications, from highway projects to corporate acquisitions.

To calculate present value of an annuity (series of equal payments), use the formula: PV = PMT × [(1 - (1 + r)^-n) / r], where PMT is the periodic payment in dollars, r is the discount rate per period (as a decimal), and n is the total number of periods. Example: What's the present value of receiving $5,000 annually for 10 years at 8% discount rate? PV = $5,000 × [(1 - (1.08)^-10) / 0.08] = $5,000 × 6.7101 = $33,550. This means ten future payments of $5,000 are worth $33,550 today. Use our "Present Value of Annuity Calculator" tab above for automatic calculations. For annuity due (payments at beginning of period), multiply the result by (1 + r). This calculation is essential for US retirement planning, mortgage valuations, lease analyses, and structured settlement evaluations across all states.

Calculate future value of an annuity using: FV = PMT × [((1 + r)^n - 1) / r], where PMT is the periodic payment, r is the interest rate per period, and n is the number of periods. Example: If you invest $1,000 annually for 20 years at 7% return, what's the future value? FV = $1,000 × [((1.07)^20 - 1) / 0.07] = $1,000 × 40.9955 = $40,995. This shows that twenty $1,000 payments grow to $40,995 with compound interest. Use our "Calculate Future Value of an Annuity" tab above for instant results. This calculation is crucial for US retirement planning (401(k) projections), education savings (529 plans), and investment portfolio planning. For annuity due (payments at period start), multiply by (1 + r). Widely used by financial planners and wealth managers across all 50 states.

For US NPV calculations, use your company's Weighted Average Cost of Capital (WACC) as the discount rate, typically ranging from 8-15% depending on industry, size, and risk profile. Key considerations: (1) Use US Treasury 10-year yield (4.11% in November 2025) as the risk-free rate foundation. (2) Add equity risk premium (typically 5-7% for US stocks). (3) Adjust for company-specific risk via beta. (4) For startups or high-risk ventures, use 15-25%+. (5) For stable, mature US corporations, use 8-12%. (6) Industry matters: utilities 6-9%, manufacturing 10-13%, technology 12-18%, biotech 15-25%. (7) Consider Federal Reserve monetary policy—higher Fed rates push discount rates up. (8) Account for state-specific risks if operating in single state. Always use after-tax WACC for after-tax cash flow NPV analysis across all US business contexts.

US state corporate tax rates (0% to 11.5%) significantly impact NPV by affecting after-tax cash flows. Combined with the 21% federal rate, total rates range from 21% (Texas, Nevada, Wyoming, South Dakota, Washington) to 32.5% (New Jersey at 11.5% state rate). Higher tax rates reduce net cash inflows, lowering NPV. When calculating NPV for US projects, multiply pre-tax cash flows by (1 - combined tax rate). Example: $100,000 pre-tax in California (8.84% state) at 29.84% combined rate yields $70,160 after-tax, while the same amount in Texas (0% state) at 21% combined rate yields $79,000 after-tax—an $8,840 difference per year. This explains corporate location decisions: companies save substantially by incorporating in tax-friendly states. Always use state-specific combined rates for accurate US NPV analysis. See our State Tax Rates calculator above.

NPV and IRR are complementary capital budgeting tools used across US corporations, but they measure different things. NPV calculates the dollar value created by an investment (e.g., NPV = $50,000 means the project adds $50,000 in present value terms). IRR calculates the percentage return of an investment (e.g., IRR = 15% means the project returns 15% annually). Decision rules: For NPV, accept if NPV > $0. For IRR, accept if IRR > discount rate. Both usually agree, but when they conflict (especially for non-conventional cash flows or mutually exclusive projects), always prefer NPV as it's theoretically superior—it shows absolute value creation and assumes reinvestment at the discount rate (more realistic than IRR's assumption of reinvestment at IRR rate). Use our IRR Solver above alongside NPV calculator for comprehensive US investment analysis.

Important clarification: "Net profit value" is NOT a standard financial term and is often confused with NPV. Net Profit is an accounting concept measuring revenues minus expenses on an accrual basis (from the income statement). Net Present Value (NPV) is a finance concept measuring present value of cash flows. They're fundamentally different: (1) Profit uses accrual accounting (non-cash items like depreciation); NPV uses cash flows only. (2) Profit is a period measure; NPV spans multiple periods with time value of money. (3) Profit appears on financial statements; NPV is a decision tool. If you're evaluating investments in the US, always use NPV based on actual cash flows, not accounting profits. The NPV formula (Σ discounted cash flows - investment) is what matters for capital budgeting across all 50 states, not profit-based metrics.

To compute NPV for multiple US projects: (1) Calculate NPV for each project independently using the same discount rate for fair comparison. (2) For independent projects (can accept multiple), accept all projects with NPV > $0. (3) For mutually exclusive projects (can only choose one), select the project with the highest positive NPV—this maximizes value creation. (4) Consider capital constraints: if limited funds, rank projects by Profitability Index (PI = PV of inflows / Initial investment) and accept highest PI projects until capital exhausted. (5) Account for different state tax rates if projects are in different locations—a project in Texas (21% combined rate) may have higher after-tax NPV than an identical project in New Jersey (32.5% rate). (6) Consider strategic factors beyond NPV: market entry, synergies, risk diversification across US regions. Use our calculator to run multiple scenarios for US business decisions.

Yes! The NPV calculator on this page is completely free for US businesses, investors, and students. No registration, no hidden fees, no limitations. Our free NPV calculator includes: (1) Standard NPV calculation with unlimited cash flow periods. (2) Present value of annuity calculator for equal payment streams. (3) Future value of annuity calculator for retirement planning. (4) IRR solver using Newton-Raphson method. (5) Net present worth calculator. (6) US state corporate tax rate database for all 50 states. (7) Real-time calculations with detailed breakdowns. (8) Mobile-responsive design for calculations on any device. (9) No downloads or installations required. (10) Privacy-focused—no data stored or shared. Perfect for Fortune 500 CFOs, startup founders, MBA students, and anyone evaluating US investments. Bookmark this page for all your NPV calculation needs nationwide.

Generally yes—accept projects with positive NPV as they create shareholder value by generating returns exceeding your cost of capital. However, consider additional factors for US projects: (1) Strategic fit: Does it align with your company's long-term strategy and core competencies? (2) Risk assessment: Have you adequately adjusted discount rate for project-specific risks not captured in WACC? Consider regulatory risk, technology obsolescence, market competition. (3) Capital constraints: With limited funds, you may need to choose between multiple positive-NPV projects; prioritize highest NPVs or use profitability index. (4) State-specific factors: Regulatory environment, tax incentives, workforce availability across different US states. (5) Qualitative factors: Brand enhancement, market share gains, competitive positioning. (6) Timing and flexibility: Option value of delaying the project. While positive NPV is the primary financial criterion for US investment decisions, combine it with strategic analysis and risk management for optimal outcomes across all 50 states.