Class A Office Building in New York
REPS qualification combined with cost segregation for maximum tax efficiency.
Property Type
Office Building
Location
New York, New York
Purchase Price
$5,600,000
Tax Savings
$89,000
Background
A Class A office building where the owner qualified as a Real Estate Professional Status (REPS) taxpayer. This status significantly increased the value of depreciation deductions.
Strategies Used
Cost Segregation
REPS Qualification
Bonus Depreciation
Our Analysis
As a REPS taxpayer, the client could use depreciation deductions to offset ordinary income without passive activity limitations. Cost segregation identified $2.1M in 5-7 year property qualifying for immediate write-off under bonus depreciation.
Results
- $254,000 in Year 1 depreciation (unrestricted)
- $89,000 in annual tax savings from depreciation
- Offset against ordinary income without passive activity restrictions
- Average annual benefit: $76,000 over 5 years
"Qualifying as REPS changed everything. TaxScout helped us maximize that advantage."
David Anderson
REPS Taxpayer & Commercial Real Estate Developer