Cost Segregation Study On a $5 Million Office Building in Kirtland, Ohio

$1,688,780.11 in first year tax savings

Without a cost segregation study, this $5 million office building in Kirtland, OH would have generated a first-year depreciation of $128,205. By applying a cost segregation study, property investors increased the first-year depreciation rate to $1,688,708. This generated a total of $1,688,780 in first-year tax savings.

Study Type Class LifePercentageAccelerated Tax
Cost Segregation  5-Year21.05%$1,056,122.96
Cost Segregation 15-Year12.11%$607,584.62
Cost Segregation39-Year66.83%$25,072.53
Total 1st Yr Depreciation with Cost Seg$1,688,780.11
Total 1st Yr Depreciation without Cost Seg$128,205
1st year disposition$2,547,766.96
Total Difference in Depreciation 1st Year $1,560,575.11

% amounts relate to how much was reallocated from the depreciated basis

Cost Segregation is based on a 40% tax bracket for federal and State Taxes and performed on the ADR Asset Depreciation Range. Financial benefits are realized by maximizing net present value through deferring tax payments and using increased cash flow to strengthen your portfolio or scale your business. The tables above identify the difference between a cost segregation study and traditional 39.5 year capitalization. The line graph (if shown) demonstrates the impact of investment cash.