Cost segregation case study CS-03
Mountain short-term rental cabin with an indoor pool
A cost segregation study on a 2006 short-term rental cabin reclassified 12.3% of the depreciable basis and kept the indoor pool in the 39-year building, rather than treating it as a 15-year land improvement under asset class 00.3.
Property profile
- Property type
- Short-term rental cabin
- Region
- Southeast
- Year built
- 2006
- Building size
- ~2,700 SF
- Site size
- ~0.7 acres
- Study type
- Acquisition
- Tax year
- 2022
Study outcome
- Total reclassified
- 12.3%
- 5-year property
- 9.0%
- 15-year property
- 3.4%
- Bonus rate
- 100%
- Accelerated depreciation
- ~$107,000 through 2025
The property
A cabin in a popular mountain short-term rental market, with an indoor swimming pool and wood-panel walls and ceilings throughout.
What we found
Other providers had quoted this owner assuming the indoor pool was a 15-year land improvement under asset class 00.3. That class covers improvements to the site, and an indoor pool is enclosed by the building, so it stays in the 39-year building basis. The pool's heat pump heater and the portable spa did qualify as 5-year property. The owner got an allocation built to hold up, not an inflated one.