Cost Segregation Study and 45L Tax Benefits on a Assisted Living Facility

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Engineered Tax Services performed a cost segregation engineering review of building components and site improvements on a 32,000 square foot building in Negaunee Michigan. The single story building has various areas devoted to office and nursing station activities, multipurpose, spa & activity rooms, areas devoted to kitchen, dining and laundry plus a salon, therapy and lobby entrance. The cost segregation benefit included a reclassification of 27.5-year depreciation class life assets into 5 and 15 year class lives, resulting in a combined benefit of $1,199,763.72.

Additionally, ETS’ next generation cost segregation study captured $76,000.00 in 45L Residential Energy Efficiency Tax Credit as well as identify $2,286.90 in qualified repairs under the final tangible property repair regulations.

$1,199,763.72 in Total Realized Tax Savings

Class Life Percentage Accelerated Tax
5-Year 16.85% $758,967.74
15-Year 9.78% $440,795.98
27.5-Year 78.37% $3,305,120.44
Total Realized Tax Benefits $4,504,884.16