Cost Segregation Case Study

Optimizing Cash
Flow for Industrial Property Owners

$5,431,703

Property Purchase Price

$670,299

1st Year Tax Savings

100%

Bonus Depreciation

Property Overview

This modern industrial facility, acquired in June 2020, encompasses 38,153 square feet of building space situated on a large 167,706 square foot site. With a purchase price of $5.4 million (excluding land value), this property represents a significant investment in industrial infrastructure. The facility’s construction includes various specialized components critical to industrial operations, making it an ideal candidate for cost segregation analysis

Property TypeIndustrial Facility
Purchase price(less land)$5,431,703
Building sqft38,153
Entire site sqft167,706
Data acquiredJune 2020
Tax year study applied2020
Tax rate37%
Present value rate of return8%
Bonus depreciation100%

Building Allocation After Study

Cost Segregation Study Benefits

Through a detailed engineering analysis, CSSI identified substantial opportunities for accelerated depreciation, with over $1.8 million in assets qualifying for 5-, 7-, and 15-year property classifications. The study generated first-year tax savings of $670,299, leveraging 100% bonus depreciation available for qualifying assets. Beyond immediate benefits, the analysis provides long-term value with a net present value of $551,701 over 10 years. When considering the future value of invested savings, the owner stands to gain over $9.2 million in potential future value, showing the significant financial impact of cost segregation for industrial properties.

Financial Benefits Achieved

Immediate Tax Savings$ 670,299
NPV Over 10 Years$551,701
NPV Over Remaining Life of Property$460, 825
Future Value of Invested Savings$9,269,626

More Case Studies