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Featured Project #1
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Acquisition I Garden Style Apartment Community
The taxpayer and their CPA engaged Bedford immediately following acquisition to identify costs that could be moved to shorter recovery periods and maximize depreciation deductions from day one.
The facility consists of eight individual apartment buildings and 244 units. The units are configured in one, two, and three bedroom varieties. There are also 15 freestanding parking garages on the property.
• Placed in Service: June 2007
• Tax Year for CSS: 2007
• Site/Lot Size: 11.28 Acres
• Number of Buildings: 8
• Gross Building Area: 506,096 SF
• Total Depreciable Basis: $37,308,303
Summary of Benefits
The following is a summary of estimated benefits calculated using a combined tax rate of 40% and a discount rate of 8%. The actual benefit is based on the client’s effective tax rate.
| Additional Depreciation Year 1 | $1,206,786 |
| Additional Taxes Deferred Year 1 | $482,714 |
| Additional Depreciation Years 1 – 5 | $5,353,536 |
| Additional Taxes Deferred Years 1 – 5 | $2,141,414 |
| 10 Year NPV of Cash Flow: | $1,794,120 |
Allocation of Costs
| Personal Property | MACRS 5-Year | $6,394,342 |
17.1% |
| Land Improvements | MACRS 15-Year | $1,845,430 |
5.0% |
| Residential Real Property | MACRS 27.5-Year | $29,068,531 |
77.9% |
Total |
$37,308,303 |
100.0% |
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Depreciation Before & After (Years 1-10)
