# Rinsecrest financial assumptions

Rinsecrest is a fictional owner-operated express wash with a 120-foot tunnel, ten vacuum bays and an attached staff room and restroom. Total hypothetical installed investment is $3,200,000, including $700,000 of nondepreciable land. Depreciable basis is exactly $2,500,000. The allocation includes proportionate capitalized soft costs and is not an appraisal, contractor bid or completed engineering study.

Acquisition is February 12, 2026 and placement in service is May 15, 2026. Full business use and GDS are assumed. The year-one figure assumes eligible acquisition and placement in service after January 19, 2025, 100 percent bonus depreciation, no required ADS and no election out. Land is separate and not depreciated.

## Wash-building treatment

Rev. Proc. 87-56 asset class 57.1 includes car wash buildings and related land improvements, as reproduced in [IRS Publication 946, Table B-2](https://www.irs.gov/pub/irs-pdf/p946.pdf); the table lists a 15-year GDS recovery period. Classification follows the stated primary car-wash use in this example. The integrated tunnel slab, shell and roof use that schedule in this example.

The attached staff room and restroom share the wash building wall and roofline and use the same 15-year class 57.1 schedule in this example.

If a study treated that room separately as 39-year property, $96,000 would move to that class: the $86,000 staff-room row plus its $10,000 share of the combined roof row. At the stated May placement, year-one depreciation would be $2,405,538.46 at 100 percent bonus and $287,488.46 without bonus, reductions of $94,461.54 and $3,261.54 respectively. This sensitivity is not included in the delivered rows.

The $6,000 formerly allocated to office furniture is assigned to installed staff-room fit-out in this revised hypothetical scenario. The visible desk, chair and storage are staging with no separate allocated basis. No office furniture is reclassified into a shorter recovery period.

## Equipment, site and grouping

Wash machinery, payment equipment, vacuum equipment and the reclaim plant use the 5-year service-equipment schedule in this example. Traced wash-water piping and dedicated equipment circuits follow the machinery they serve, consistent with functional allocation in the [IRS Cost Segregation Audit Techniques Guide](https://www.irs.gov/pub/irs-pdf/p5653.pdf). Paving, curbs, site drainage, permanent vacuum shade, landscaping, site lighting, the permanent sign pylon and the boundary wall use 15 years in this example. The removable illuminated sign face remains a separate 5-year asset.

Two genuine groups replace four rows: queue and vacuum paving combine $220,000 plus $100,000, and dedicated wash piping and controls combine $95,000 plus $85,000. Their recovery periods and total amounts are unchanged. The roof now has one $175,000 row, including the prior $10,000 staff roof share. No row is on 7 years or the building schedule. The buildingYears value of 39 exists only to satisfy the common schema.

## Year-one depreciation

| Class | Basis |
|---|---:|
| 5-year | $1,105,000 |
| 7-year | $0 |
| 15-year | $1,395,000 |
| Building | $0 |

Year-one federal depreciation at the assumed 100 percent bonus rate is **$2,500,000**. Without bonus it is **$290,750**, using 20 percent for 5-year assets and 5 percent for 15-year assets under the half-year convention. These amounts are deductions, not tax savings or cash receipts. They do not determine an owner's usable loss, state treatment or future recapture. No section 179 election is modeled.

[IRS Notice 2026-11](https://www.irs.gov/pub/irs-drop/n-26-11.pdf) addresses the restored 100 percent additional first-year allowance and qualifying acquisition and placement dates. [Publication 946](https://www.irs.gov/pub/irs-pdf/p946.pdf) explains the recovery methods and conventions. This illustration depends on those stated eligibility assumptions and excludes land.

## Illustrative allocation

| Component | Financial label | Basis | Schedule |
|---|---|---:|---|
| `stacking_paving` | Queue and vacuum paving | $320,000 | 15 years |
| `site_drainage` | Curbs and site drainage | $60,000 | 15 years |
| `tunnel_slab` | Tunnel floor and foundation | $90,000 | 15 years |
| `tunnel_shell` | Glazed wash tunnel | $390,000 | 15 years |
| `office` | Attached staff room | $86,000 | 15 years |
| `conveyor` | Conveyor and guide rails | $135,000 | 5 years |
| `wash_entry` | Presoak and entry equipment | $85,000 | 5 years |
| `wash_brushes` | Wash brushes | $170,000 | 5 years |
| `rinse_arch` | Rinse and finish arches | $65,000 | 5 years |
| `dryers` | Dryers | $110,000 | 5 years |
| `process_plumbing` | Wash piping and controls | $180,000 | 5 years |
| `water_reclaim` | Water reclaim system | $145,000 | 5 years |
| `pay_stations` | Pay stations and gates | $70,000 | 5 years |
| `vacuum_canopies` | Vacuum shade canopies | $149,000 | 15 years |
| `vacuum_equipment` | Vacuum stations | $110,000 | 5 years |
| `road_sign_pylon` | Roadside sign pylon | $15,000 | 15 years |
| `road_sign` | Illuminated sign face | $35,000 | 5 years |
| `landscaping` | California planting beds | $35,000 | 15 years |
| `site_lighting` | Site lights | $30,000 | 15 years |
| `perimeter_walls` | Rear perimeter wall | $45,000 | 15 years |
| `roof` | Wash building roof | $175,000 | 15 years |

Total depreciable basis: **$2,500,000**. Land: **$700,000**. Total investment: **$3,200,000**.

The logical car-wash layout has 17 rows on the left and four wash-building rows on the right. Its buildingColumn ids are tunnel_slab, tunnel_shell, office and roof. The current unmodified scratch player does not implement that field: it combines all 15-year rows on the left and leaves the ordinary building column empty. Basis must enable the documented field before publishing this layout. No financial class is changed to accommodate the current player.