We thought this would be a good time to show you a few real life examples of savings that are available by incorporating the concepts we've introduced in previous newsletters.
Below you will find four case studies including an apartment complex, auto dealership, office building, and shopping center. These are some of the more common property types selected for costs segregation studies, but almost all property types generate significant savings.
All of the studies were completed for the 2007 tax filing year. The fees to perform the studies ranged from $7,000 to $11,000 which were more than paid back by the first year tax savings alone.
Even though the 2007 filing deadlines are rapidly approaching, studies can still be completed to meet tax due dates, including extensions. Call or log on today for a complimentary feasibility analysis showing your Net Present Value tax savings for properties constructed or acquired in 2007 or before. You will not be disappointed!
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Apartment Complex - NPV Tax Savings:$1,280,700
 This facility was constructed new in 1999 for $23.3M. The engineering based cost segregation study allowed the reclassification of ~25% of the construction costs into shorter recovery periods.
5-Year Personal Property: $3,868,400
15-Year Land Improvements: $2,028,300
This resulted in:
 Additional first year depreciation of $3,826,600
First year tax savings of $1,583,800
Net Present Value (NPV) tax savings of $1,280,700
This property received a large first year tax savings from a catch-up adjustment due to the retroactive nature of the study. The automatic change in method of accounting required filing Form 3115 but did not require amended returns or prior IRS approval.
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Cost Recovery Solutions, LLC
www.crscostseg.com
407 Main Street
Metuchen, NJ 08840
P: (732) 548-3855
F: (732) 549-8844
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This facility was constructed new in 2007 for $5.3M. The engineering based cost segregation study allowed the reclassification of ~31% of the construction costs into shorter recovery periods.
This facility was acquired in 2007 for $14.7M (excluding land). The engineering based cost segregation study allowed the reclassification of ~19% of the building basis into shorter recovery periods.
This facility was acquired in 2007 for $8.9M (excluding land). The engineering based cost segregation study allowed the reclassification of ~22% of the building basis into shorter recovery periods.
