Hospitality Assets: Motels and Hotels

Cost Segregation Studies

motel cost segregation Hospitality assets provide rich ground for cost segregation studies. Hotels cost segregation benefits property owners by accelerating depreciation on personal property.

Short life items are found in every room, as well as common areas both inside and outside of the building.

Additional opportunities are found in the lighted parking areas and swimming pool areas.

Our studies also break out the IRS mandated Units of Property when considering the long-term components present in your building.

hotels cost segregation

It is common for our hospitality studies to pay back the cost of the study by more than 30 to 1 in the first year of study use. Note the actual results highlighted in the table below.

While most of these studies include catch-up years, the results are astoundingly positive, with over $100,000 in tax savings in the first year of study use!


Sample of Actual Study Results

Depreciable Basis

$7,513,390
$3,309,000
$8,292,875
$2,566,500
$1,541,605


Purchase Date

FEB 2014
JAN 2013
MAY 2014
NOV 2012
MAY 2015


Year of Study

2014
2015
2015
2015
2016


1st Year Additional Depreciation

$392,464
$451,748
$1,186,211
$492,635
$331,716


1st Year Tax Savings

$155,416
$178,892
$469,739
$195,084
$131,360


Year 1 Payback

34.5:1
59.6:1
156.6:1
65.0:1
128.9:1


Initial 5 Years Tax Savings

$709,682
$247,811*
$829,856*
$241,413*
$239,115*


5 Year Payback

157.7:1
82.6:1
276.6:1
80.5:1
222.4:1

* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.

NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.

Free Analysis & Price Quote

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