This success story reviews a boat manufacturer located in Ashland City, Tennessee who reached out to our team for Cost Segregation and Fixed Asset Analysis.
Approach
After performing a thorough on-site inspection and review of the facility’s blueprints, our consultants identified four types of Section 1245 Personal Property within the 2019 project. These personal property assets – all bonus depreciation eligible – made up 35% of the project’s total costs. In addition, we reclassified 10% of the project costs as Qualified Improvement Property due to the renovation of general interior finishes, water heaters, and general lighting within the building’s footprint. The project finalized 30 days after site visit.
Benefit
Our team maximized potential savings and exceeded our original projections for the project, including:
- 63% of project’s assets reclassified out of 29-year property into shorter tax lives.
- 4 times quadrupled our projected increase in first year cash flow.
Indications of a Fixed Asset Opportunity
- Have you purchased or constructed a building with a cost in excess of $750,000?
- Have you made renovations to your facility?
- Are you maintaining depreciation records for many fixed assets?
Conclusion
Since 2014, McGuire Sponsel and LBMC have partnered to provide first-class service with integrity that brings value to LBMC’s clients. As a national specialty tax consulting firm, McGuire Sponsel offers Research & Development Tax Credits, Fixed Asset Services including Cost Segregation, Global Business Services and Credit and Incentive Services. Contact Mike Dalman for more information and to get started.
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