Cost Segregation in Savannah, GA: $120,000 in Accelerated Depreciation

Savannah's historic district, riverfront tourism, and year-round event calendar create consistent STR demand in one of the Southeast's most photogenic cities.

$120,000 Accelerated Depreciation
$44,400 Est. Year-1 Tax Savings
56x Return on Study Cost

See Your Savannah Tax Savings

$44,400
Estimated Year-1 Tax Savings
$120,000
Accelerated Deductions
$795
Study Cost
56x
ROI on Study
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Estimates are for illustration only. Details

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MACRS Depreciation Breakdown

Accelerated Depreciation by MACRS Class
$120,000 total reclassified into shorter recovery periods
5-Year Property $84,000
70%
7-Year Property $9,600
8%
15-Year Property $26,400
22%
Estimated Year-1 Tax Savings $44,400

Illustrative estimate. Final allocations vary based on property facts and report findings.

Method
Year-1 Deduction
Difference
Standard (27.5yr straight-line)
$14,545
—
With Cost Segregation + Bonus
$120,000
+$105,455
Estimated deduction based on typical cost segregation allocations for airbnb / short-term rental properties. Actual study results may vary based on property-specific analysis including age, condition, renovations, and local construction costs.

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Cost Segregation in Savannah, GA

$500,000 Airbnb / Short-Term Rental property — cost segregation depreciation example
Top Neighborhoods
Historic District, Tybee Island, Starland District
Typical Year-1 Savings
$25,000–$52,000

Savannah's STR market draws on the city's distinctive character: cobblestone streets, Spanish moss, historic squares, and a walkable downtown that hosts St. Patrick's Day celebrations, SCAD events, and a growing culinary tourism scene. Properties in the Historic District and surrounding neighborhoods like Starland, Ardsley Park, and Tybee Island (beach access) generate strong year-round bookings. STR purchase prices in Savannah typically range from $350K to $700K.

At $500,000, a Savannah STR has a depreciable basis of approximately $400,000. Cost segregation reclassifies $120,000 into accelerated MACRS classes. Historic homes, which are common in this market, often contain significant reclassifiable components: period-appropriate lighting, restored hardwood over subfloor systems, updated kitchen and bathroom buildouts, and landscaped courtyard improvements. With 100% bonus depreciation, the full $120,000 is deductible in year one, generating $44,400 in federal tax savings.

Georgia levies a 5.49% flat state income tax, so the accelerated depreciation reduces both federal and state liability. For a $500K Savannah STR, the state savings add approximately $6,590 on top of the federal benefit. STR investors who materially participate can offset W-2 income with the accelerated depreciation. Results vary based on the property's age, renovation history, and construction type — older historic homes may have different component distributions than newer builds.

Why Cost Segregation Works for Short-Term Rentals

Short-term rentals contain a higher concentration of depreciable personal property than almost any other residential property type. Furniture, appliances, linens, kitchenware, electronics, decorative fixtures, and specialty items like hot tubs or game room equipment all qualify as 5-year property under the IRS MACRS classification system. This furniture, fixtures, and equipment (FF&E) component typically represents 15-20% of the depreciable basis.

Beyond interior components, site improvements add additional reclassification value. Driveways, walkways, patios, outdoor lighting, fencing, landscaping, and irrigation systems fall into the 15-year MACRS class rather than the default 27.5-year residential schedule. For STR properties with pools, outdoor kitchens, or fire pits, these components can represent a meaningful share of the total reclassified amount.

With 100% bonus depreciation permanently restored under the One Big Beautiful Bill Act (signed July 2025), every dollar reclassified into 5-year, 7-year, or 15-year MACRS classes is deductible in full in the first year. For STR owners who materially participate in their rental operation, these accelerated deductions can offset W-2 and business income — not just passive rental income.

Who This Example Applies To

If your property is a passive investment managed entirely by a third party, the accelerated depreciation may only offset passive income. If your property has minimal furnishings or you plan to sell within 1-2 years, the benefit may be reduced. Actual results vary based on property age, condition, renovations, and local construction costs.

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Compare: Airbnb / Short-Term Rental at Different Price Points

Price Accelerated Tax Savings Study Cost ROI
$300K $72,000 $26,640 $795 34x
$500K $120,000 $44,400 $795 56x
$750K $180,000 $66,600 $795 84x
$1M $240,000 $88,800 $1,195 74x
$400K $96,000 $35,520 $795 45x
$600K $144,000 $53,280 $795 67x
$1.5M $360,000 $133,200 $1,195 111x
$450K $108,000 $39,960 $795 50x
$700K $168,000 $62,160 $795 78x
$800K $192,000 $71,040 $795 89x

Compare: $500,000 Across Property Types

Property Type Accelerated Tax Savings Study Cost ROI
Airbnb / Short-Term Rental $120,000 $44,400 $795 56x
Rental Property $80,000 $29,600 $795 37x
Duplex $88,000 $32,560 $995 33x
Condo $68,000 $25,160 $795 32x
Triplex $88,000 $32,560 $995 33x

Frequently Asked Questions

What is a cost segregation study? ▼

A cost segregation study is an engineering-based analysis that reclassifies components of your property into shorter IRS depreciation categories (5, 7, and 15 years) instead of the default 27.5 or 39 years. This accelerates your depreciation deductions, reducing your tax bill in the early years of ownership.

How does bonus depreciation work with Airbnb properties? ▼

Under the One Big Beautiful Bill Act (signed July 2025), 100% bonus depreciation is permanently restored for 2025 and beyond. This means every dollar of depreciation reclassified into 5-year, 7-year, or 15-year MACRS classes through cost segregation can be deducted in full in the first year you place the property in service.

How long does a cost segregation study take? ▼

Our studies are delivered in 3-5 business days. You provide the property address, purchase price, and closing date — we handle everything else using assessor records, satellite imagery, and construction cost databases. No site visit or tenant disruption required.

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