$3.9 Million Cash Benefit During Year One

New Construction of $25MM Multi-Family Community in Arizona

Meridian was referred to conduct a cost segregation analysis for the new construction of a residential rental complex in Arizona. The investment amounted to over $25 million exclusive of land value.

Engineering Process

Meridian’s experienced professionals applied their knowledge of engineering, construction, and architectural design, along with a thorough understanding of the IRS depreciation guidelines, to complete a cost segregation analysis of the property the same tax year it was capitalized. Our professionals completed an extensive site inspection and reviewed comprehensive property documentation. The deliverable report included exhaustive documentation and calculations for each asset and cited tax law to support all asset classifications.

Study Results

Reclassification of assets due to our study yielded $4.5 million of land improvement property with a fifteen-year life, and $4.75 million of personal property with a five-year life. The client satisfied the requirements for 100% bonus depreciation, which effectuated approximately $9.8 million in depreciation, and a $3.9 million dollar cash benefit in year one.