Property Overview

• Property Type: Pre-School Facility

• Location: Wesley Chapel, FL

• Year Acquired: 2023

• Year Built: 2006

• Building Size: 10,091 sq ft

• Total Depreciable Basis: $3,020,340.93

• Placed in Service: September 15, 2023

  Pre-School Study on a $3,020,34…

Key Results

Asset Reclassification

Total accelerated property (5-year + 15-year): $1,178,437

39.02% of the entire property was reclassified to shorter depreciation lives.

Immediate Tax Impact

Immediate Tax Benefit

$1,052,685

Projected 5-Year Tax Benefit

$1,352,903

These benefits come from accelerating depreciation on nearly $1.18M of the property basis that would otherwise depreciate over 39 years.

Depreciation Impact

Before Cost Segregation

Standard straight-line depreciation over 39 years.

After Cost Segregation

• $497,915 depreciated over 5 years

• $680,522 depreciated over 15 years

This front-loads deductions and dramatically increases early-year tax write-offs.

The depreciation comparison chart on page 2 of the report shows the large increase in first-year depreciation once the assets are properly classified.

Examples of Accelerated Assets Identified

The engineering study identified numerous building components eligible for shorter recovery periods, including:

5-Year Assets

• Security systems

• Dedicated electrical outlets

• Kitchen equipment

• Appliances

• Specialty flooring

• Certain electrical systems

15-Year Land Improvements

• Playground equipment

• Concrete sidewalks

• Asphalt paving

• Landscaping

• Site drainage

• Fencing

These assets are commonly grouped into the building structure but qualify for faster depreciation when analyzed through an engineering-based study.

Financial Takeaway

Property Basis:
$3,020,340

Accelerated Basis Identified:
$1,178,437

Immediate Tax Benefit:
$1,052,685

Projected 5-Year Benefit:
$1,352,903

Nearly 40% of the building’s cost basis was moved into accelerated depreciation categories, generating over $1M in immediate tax savings.