The developer turned to the Tax team at Springline which recommended a cost segregation study, a tax analysis performed by an engineering firm. The study works to identify specific property components and reclassify them into shorter depreciation recovery periods. After producing an estimated benefit analysis, the team concluded the potential tax savings more than justified the study. While the depreciation period for the building is 30 years, the study identified $10 million worth of shorter-life property – including appliances, furniture, fixtures and equipment – that qualified for “bonus depreciation,” a tax incentive that allows a business to deduct 100% of the cost of qualifying new and used assets in the first year they’re placed in service. In this case, the developer was able to depreciate many of the property’s assets over five to seven years. The study was also a “look-back” study, which allowed the client to “catch up” on missed depreciation on its current tax return by amending the prior year’s return.