Myrtle Beach: 20 Million Visitors and Counting
The Grand Strand draws over 20 million visitors annually, making Myrtle Beach one of the most-visited destinations on the East Coast. The vacation rental market here is massive—from oceanfront condos along Ocean Boulevard to golf-course villas in Barefoot Landing and beach houses in Surfside Beach and Garden City. The median condo price in Horry County sits around $250,000, while single-family beach houses range from $350K to $800K depending on proximity to the ocean.
If you own a Myrtle Beach vacation rental that generates $30,000-$80,000 in annual gross revenue, that's taxable income. A cost segregation study accelerates a significant portion of your depreciation deductions into Year 1, reducing your tax bill on that rental income immediately.
South Carolina's Favorable Tax Environment
South Carolina's top marginal income tax rate is 6.4% (on income over $16,040). The state conforms to federal depreciation rules, including 100% bonus depreciation. Combined federal + state, an investor in the 37% bracket faces approximately 43.4%. That means every $100,000 in accelerated depreciation saves roughly $43,400 in combined taxes.
Oceanfront condo improvements—tile flooring, kitchen cabinetry, bathroom vanities, appliances, light fixtures, balcony railings—are all 5-year property eligible for 100% bonus depreciation. Even a $250K condo can generate $20K-$35K in accelerated Year 1 deductions.
A Real Example: Oceanfront 2BR Condo in North Myrtle Beach
The property: A 2-bedroom, 2-bathroom oceanfront condo in North Myrtle Beach (28582), purchased in May 2023 for $385,000. Built in 2008. Fully furnished as a vacation rental, generating $48,000/year in gross revenue. The owner is a corporate manager in Charlotte with W-2 income of $210,000.
Without cost segregation: Depreciable basis (after 10% land for condo) is $346,500. Straight-line: $12,600 per year.
With cost segregation:
| Category | Amount | Year 1 Deduction |
|---|---|---|
| 5-Year Property (furniture, appliances, cabinetry, flooring, fixtures, decor) | $72,800 | $72,800 (100% bonus) |
| 15-Year Property (balcony improvements, parking lot share, landscaping share) | $10,400 | $10,400 (100% bonus) |
| 27.5-Year Property (remaining condo structure) | $263,300 | $9,575 (straight-line) |
| Total Year 1 Accelerated Deductions | $83,200 |
At a 40% combined rate, that's approximately $33,300 in estimated combined tax savings. The fully furnished vacation rental generates the highest reclassification percentage because all the furniture, kitchen equipment, and decor are 5-year property.
Myrtle Beach Area Investment Zones
North Myrtle Beach / Cherry Grove (28582): Oceanfront condos and beach houses. $250K-$600K. Strong summer rental income with growing shoulder-season demand.
Myrtle Beach Oceanfront (29577): High-rise condos from $200K-$450K. High density of vacation rentals with established management companies.
Surfside Beach / Garden City (29575, 29576): Family-oriented beach communities. Single-family beach houses $400K-$700K with pools, outdoor showers, and elevated decks—all reclassifiable.
Barefoot Landing / North Shore (29579): Golf-course condos and villas. $200K-$400K. Year-round golf tourism extends the rental season.
Pawleys Island / Litchfield (29585): Upscale end of the Grand Strand. Beach houses $500K-$1M+ with significant outdoor improvements.
100% Bonus Depreciation and Lookback
The OBBBA permanently restored 100% bonus depreciation. For Grand Strand investors who purchased in prior years, lookback studies via Form 3115 capture all missed accelerated depreciation in one year.
Getting Started
Provide your property details and we deliver a CPA-ready report in under an hour. Your CPA applies it to your federal and South Carolina state returns.
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