Green Buildings
Cost Segregation
Green Buildings typically incorporate many short life components. The “green” aspect of the building often incorporates even more short life assets than found in a typical office building. Our cost segregation studies consider all office suites and all common areas within the building when identifying these items.
Additional opportunities are found in the lighted parking areas or parking structures, landscaping and building signage. Our cost segregation studies also break out the IRS mandated Units of Property when considering the long-term components present in your building.
Our green building studies typically pay back the cost of the study in the range of 3 to 1 up to more than 75 to 1 in the first year of study use. Note the actual results highlighted in the table below. First year savings range from almost $15,000 for a modestly sized office building up to in excess of $225,000 for a large asset!
Sample of Actual Study Results
Depreciable Basis
$11,116,528
$8,001,552
$9,193,781
$4,996,171
$10,131,646
Purchase Date
10/1/2015
3/1/2016
1/1/2015
9/1/2015
8/1/2013
Year of Study
2015
2016
2015
2015
2013
1st Year Additional Depreciation
$433,309
$215,251
$230,700
$154,195
$239,923
1st Year Tax Savings
$151,658
$83,948
$80,745
$60,136
$95,009
Year 1 Payback
47.6:1
27.5:1
27.6:1
19.7:1
31.5:1
Initial 5 Years Tax Savings
$652,050
$415,806
$419,244
$266,203
$442,523
5 Year Payback
206.0:1
137.0:1
144.0:1
88.3:1
148.0:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.
NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.