Retailers engage us to assign the proper
depreciation life to their real estate
assets to ensure their capital costs are
recovered as soon as possible. Even
purchased facilities may have
substantial assets qualifying for
accelerated depreciation that can lower
taxable income as some of our recent
studies show:
Shopping Center Complex:
A professionally completed cost
segregation study for a similar shopping
center complex valued at $14.5 million
resulted in an additional $1.45 million
in depreciation over the first four
years of service. The income taxes
deferred over the same time period
amounted to $610,000 (using a 39%
combined federal and state income tax
rates.)
Virginia Shopping Mall:
A 20-shop strip-mall anchored by a
supermarket was purchased for $2,000,000
in 2000. We located 108 qualified
assets: $242,000 in 15-Year and $221,000
in 5-Year. Under the recently enacted
Revenue Procedure 2002-19, the first
year's additional depreciation was
$161,968 with a tax savings of $72,886.
California Mini-mall:
A new supermarket with 7 shops
built for $3,700,000. We located 157
assets: $888,000 in 15-year and $898,000
in 5-Year. The first year's depreciation
is $273,075 with a tax savings of
$122,884.
Cost segregation studies can be
performed on current, as well as on
past, real estate transactions. Contact
a Cost Segregation professional
for a free cost benefit analysis on all
of your real estate transactions, past
or present.
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