Restaurant dining room with dark wood tables, chairs and warm lighting

Restaurant Cost Segregation Case Study

$341,000 of a $1,100,000 restaurant, 31% of the cost, deducted in the first year.

Study Summary

A $1,100,000 restaurant placed in service in April 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 31% of it as 5 and 15 year property. With 100% bonus depreciation, that $341,000 was deducted in the first year, and at a 37% tax rate it added $126,170 to the owner’s cash flow in year one.

Property type
Restaurant
Cost basis
$1,100,000
Placed in service
April 2026
Tax rate
37%
Bonus depreciation
100%
  • $341,000

    Accelerated depreciation, deducted in year one

  • $126,170

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

  • $28,205

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

  • $360,462

    Year-one deduction with the study, more than 12 times as much

Where the $1,100,000 Went

  • 5 year property

    Kitchen equipment, counters, specialty electrical and dining room finishes

    $242,00022%
  • 15 year property

    Paving, signage, sidewalks, landscaping and drive-through features

    $99,0009%
  • 39 year property

    The shell, roof and structure, left on the standard schedule

    $759,00069%

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.