Cost Segregation allows property owners to recover their real estate investment over a much shorter time period resulting in increased cash flow in the earlier years of building ownership. Segregating assets from property that would be depreciated over 39 years for most commercial real estate or 27.5 years for commercial-residential property as apartments into much shorter 15, 7 or 5 year depreciation schedules provides significant advantages to property owners.
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12 Year Old Light Manufacturing Building
Acquired two years ago
Acquisition Cost $4.2 Million Dollars
Five Year Depreciation without Cost Segregation $486,614
39 Year Property 73%
15 Year Property 22%
5 Year Property 5%
Estimated 5 Year Accelerated Depreciation $885,845
Estimated 5 Year Increased Cash Flow $159,138 |
New Three Story Suburban Office Building
Placed into Service in the Current Tax Year
Acquisition Cost $6.3 Million Dollars
Five Year Depreciation without Cost Segregation
$726,923
39 Year Property 73%
15 Year Property 21%
7 Year Property 2%
5 Year Property 4%
Estimated 5 Year Accelerated Depreciation $1,364,406
Estimated 5 Year Increased Cash Flow $247,038 |
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New 36 Unit Apartment Building
Placed into Service in Current Tax Year
Acquisition Cost $4.275 Million Dollars
Five Year Depreciation without Cost Segregation $777,275
27.5 Year Property 76%
15 Year Property 10%
5 Year Property 14%
Estimated 5 Year Accelerated Depreciation $1,352,229
Estimated 5 Year Increased Cash Flow $ 217,069 |
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5 Year Old Acquired Branch Bank
Acquired one year ago
Acquisition Cost $960,000
Five Year Depreciation without Cost Segregation
$110,769
39 Year Property 80%
15 Year Property 16%
7 Year Property 1%
5 Year Property 3%
Estimated 5 Year Accelerated Depreciation $181,076
Estimated 5 Year Increased Cash Flow $27,240 |
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