Cost Segregation and 45L Tax Benefits for an Assisted Living Facility

$1,199,763.72 in Total Realized Tax Savings

By applying cost segregation, property investors accelerate depreciation, reduce tax liability and increase their bottom line. This aids in future benefits via abandonment, repairs, routine maintenance and overall asset management. ETS performs hundreds of cost segregation studies on a monthly basis for property owners, providing a detailed engineering review of assets including special purpose mechanical and electrical systems, decorative finishes, site improvements, and any process related to special purpose construction.

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 Total Realized Tax Benefits   $4,504,884.16
Study Details – New Construction Assisted Living Facility: 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.

Cost Segregation

Engineered Tax Services, Inc. (ETS) has helped thousands of property owners nationally increase their cash-flow by accelerating depreciation through our cost segregation studies. Our cost segregation studies work to uncover potential tax savings and increase cash flow through reclassification and depreciation of property. ETS provides a “Detailed Engineering” review as part of our reporting process, working seamlessly with the IRS and your CPA firm for minimal disruption to your business.


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