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Cost Segregation Benefits for Hotel Owners |
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Apartments - Hotels - Manufacturers - Offices - Restaurants - Retail Plazas - Warehouses In the exmaple of a hotel owner, if the cost of the hotel was $4.8 million, the owner can still generate a large amount of taxable income even after maintenance fees and expenses. Appyling Cost Segregation to the hotel and depreciating equipment and other assets over shorter life periods, the owner will save $109,107 in the first year over a traditional straight-line deduction. | Cash Flow Increased in year 1 | $ | 109,107 | | Cash Flow Increased in year 1-6 | $ | 479,044 | | Net Present Value (NPV) | $ | 388,246 | | Combined Tax Rate | | 41% | | Net Present Value Factor | | 8% |
| Asset Class | Percent
Reclassed | | Depreciable
Basis | | 5 - Year Property | 24% | | 1,200,000 | | 7 - Year Property | 3% | | 150,000 | | 15 - Year Property | 13% | | 660,000 | | 39 - Year Property | 60.0% | | 3,000,000 | | Total Real Property | $ | 5,000,000 |
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