Medical procedure room with a treatment table, overhead lights and wall mounted equipment

Medical Office Cost Segregation Case Study

$792,000 of a $2,400,000 medical office, 33% of the cost, deducted in the first year.

Study Summary

A $2,400,000 medical office placed in service in June 2026, studied for the 2026 tax year.

Without a study, the owner would depreciate the full cost basis as 39 year property. Our engineers identified 33% of it as 5 and 15 year property. With 100% bonus depreciation, that $792,000 was deducted in the first year, and at a 37% tax rate it added $293,040 to the owner’s cash flow in year one.

Property type
Medical office
Cost basis
$2,400,000
Placed in service
June 2026
Tax rate
37%
Bonus depreciation
100%
  • $792,000

    Accelerated depreciation, deducted in year one

  • $293,040

    Additional cash flow in year one at a 37% tax rate

  • $61,538

    Year-one deduction without a study, straight-line over 39 years

  • $833,231

    Year-one deduction with the study, more than 13 times as much

Where the $2,400,000 Went

  • 5 year property

    Specialty cabinetry, dedicated electrical, clinical fixtures and finishes

    $600,00025%
  • 15 year property

    Walkways, parking, landscaping and site lighting

    $192,0008%
  • 39 year property

    The shell, structure and base building systems, left on the standard schedule

    $1,608,00067%

Year-one figures are simplified: straight-line divides the basis evenly over 39 years and leaves out the mid-month convention. Results depend on your property.

Cost Segregation Results by Property Type

Accelerated depreciation is the part of the price our engineers moved onto 5, 7 and 15 year schedules. Select a study to see its full numbers.