PURCHASE

• Capitalized Cost: $ 55,000,000
• % Personal Property Segregated: 10%
• % Land Imp. Segregated: 2%
• % Building: 75%
• % Land: 13%

SAVINGS:

• Year 1 Depreciation Exp w/out CSS: $1,200,000
• Year 1 Depreciation Exp with CSS: $1,950,000
• Increased Depreciation $ 750,000
• First full tax year tax benefit $ 262,500

NPV Savings $ 1,100,000 

YEAR OF SALE STUDY

• Depreciable Basis: $3,540,000
• % Personal Property Segregated: 10%
• % Land Imp. Segregated: 8%
• % Building: 82%

SAVINGS:

• Accumulated Depreciation as of 12/31 w/out CSS: $229,235
• Accumulated Depreciation as of 12/31 w/CSS: $411,428
• Section 481 Adjustment ( Missed Depreciation) $ 182,193
• Year of Change Tax Savings $69,736

LOOK BACK 

• Depreciable Basis: $3,700,000
• % Personal Property Segregated: 6%
• % Land Imp.Segregated: 17%
• % Building: 77%

SAVINGS:

• Accumulated Depreciation as of 12/31/2007 w/out CSS: $823,000
• Accumulated Depreciation as of 12/31/2007 w/CSS: 1,133,000
• Section 481 Adjustment ( Missed Depreciation ) $310,000
• Year of Change Tax Savings: $121,000

Purchase (Price $3,064,771)

• % Personal Property Segregated:6%
• % Land Imp. Segregated: 9%
• % Building: 29%
• % Land: 56%

SAVINGS:

• Year 1 Depreciation w/out CSS: $ 34,500
• Year 1 Depreciation w/CSS: $73,500
• Increase Depreciation Expense: $39,000
• First Full Year Tax Benefit: $ 15,100
• Net Present Value Savings $64,000