Tax Law Revisions Reward Commercial Real Estate Investors
Bonus Depreciation allows you to keep more of your early cash flows at the time you need it most. Compare the impact of Bonus Depreciation to Straight-Line Depreciation on the same asset. Let’s consider a hypothetical:
Straight- Line
No Cost Segregation Study
39 Year Depreciation Schedule
No Consideration of MACRS
Year 1 Depreciation: $25641
Income after Depreciation:
$74,000*
Assumptions:
Property Acquired for $1.5 Million
Warehouse Property
Land Value: $500,000
Improvements: $1,000,000
MACRS Assets: $200,000
Acquired after Jan 19th, 2025
Current Lease NOI: $100,000/yr
Bonus Depreciation
Cost Segregation Study
100% MACRS Depreciation
39 Year Depreciation Long-Lived Assets.
MACRS Depreciation: $200,000
Long-term Assets Year 1 Depreciation: $20,512
Income after Depreciation:
$-120512*
* This example is for illustration only and its assumptions may not be applicable in all circumstances. Cost Segregation services are a compliant first step to quantify assets eligible for bonus depreciation, but the contents of this website are not professional services or tax advice. Estimates provided to customers on the potential value of MACRS assets are not determinative of a final report, and actual value can be determined only via signed engagement letter, onsite verification, replacement values as determined by engineers, and with client approval. SEGTEX LLC makes all reasonable efforts to field-verify assets which may be eligible for bonus depreciation, but is not responsible for shortages in bonus depreciation estimates once a client approves the draft report.