General Office Cost Segregation Case Study

Cost Segregation is a commonly used strategic tax planning tool that allows companies and individuals who have constructed, purchased, expanded or remodeled any kind of real estate to immediately reduce tax by accelerating depreciation deductions and deferring federal and state income taxes. The following is a case study for a general office to demonstrate the benefits of accelerated depreciation on this property type.

What is Cost Segregation?

Cost Segregation is a commonly used strategic tax planning tool that allows companies and individuals who have constructed, purchased, expanded or remodeled any kind of real estate to increase cash flow by accelerating depreciation deductions and deferring federal and state income taxes.

Building Type: Office, General

Summary of Benefits Results
Additional Tax Deductions in First Year $1,267,504
Net Present Value (NPV) Over 10 Years $367,476
NPV Over Remaining Life of Property $303,655
*Benefits typical for tax returns filed 2018-2022

Building Allocation After Study

CS Case Study General Office Building Allocation

Building Information

Purchase Price of Property (less land) $5,830,000
Property Type Office - general
Building Sq Ft 60,300
Entire Site Sq Ft 109,500
Date Acquired July - Current Tax Year
Federal Tax Rate 29.6%
State Tax Rate 5%
Combined Tax Rate 34.6%
ROI Factor 8%
Bonus Depreciation 100%

Calculate Your Tax Savings

Use our Cost Segregation Savings Calculator to estimate tax savings for your type of building. Enter building details for instant results at kbkg.com/costsegregation/calculator.

 

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General Office Cost Segregation Case Study

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