|
Featured Project #2
|
Look-Back Study I Restaurant
The property is a full service restaurant which was constructed by the taxpayer when 30% bonus depreication was available. The taxpayer did not elect-out of bonus depreciation and was therefore allowed to claim the bonus as part of their 481(a) adjustment. The property met all of the qualifications.
• Placed in Service: October 2002
• Tax Year for CSS: 2007
• Site/Lot Size: 2.57 Acres
• Number of Buildings: 1
• Gross Building Area: 6,990 SF
• Total Depreciable Basis: $1,553,539
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 | $417,283 |
| - Includes a 481(a) adjustment of | $398,275 |
| Additional Taxes Deferred Year 1 | $166,913 |
| 10 Year NPV of Cash Flow: | $167,392 |
Allocation of Costs
| Personal Property | MACRS 5-Year | $255,099 |
16.4% |
| Land Improvements | MACRS 15-Year | $428,864 |
27.6% |
| Real Property | MACRS 39-Year | $869,576 |
56.0% |
Total |
$1,553,539 |
100.0% |
|
Depreciation Before & After (Years 1-10)
