# Alderwell Dental: financial assumptions

Fictional building acquisition for $2,400,000 including $400,000 nondepreciable land; these allocations are authored educational assumptions, not an appraisal, engineering study or construction bid.
Acquired May 1, 2026 and placed in service May 15, 2026; 100% owner-occupied business use and a calendar tax year are assumed.
The fictional older brick practice has stone trim, recessed windows, blue joinery and a low membrane roof with a clerestory; it is not a replica of a real property.
The single-story 24.0 by 23.225 meter envelope is approximately 6,000 square feet. Eight operatories face perimeter windows, with two circulation aisles connecting reception and central clinical support rooms.
Dental chairs, imaging machines, sterilizers, computers, loose furniture and staff appliances are bought separately. They are excluded from both the $2.4 million acquisition price and all depreciation rows.
Only removable dental-specific casework and documented equipment-only plumbing and electrical branches receive 5-year treatment. General building distribution and built-in counters remain 39-year.
The 5-year and 15-year basis totals $630,000, or 31.5% of the $2,000,000 depreciable basis.
Permanent lead shielding, clinical vinyl and tile, reception millwork, domestic plumbing, staff cabinets and comfort HVAC remain building property. Replaceable carpet tiles are separately identified.
The whole permanently founded monument sign is conservatively classified as a 15-year site improvement; no separate short-life sign face is modeled.
Eligible acquired short-life property is assumed to meet 100% bonus requirements, including unrelated-party acquisition and prior-use requirements. No ADS requirement, election out or section 179 deduction is assumed.
Without bonus, 5-year property uses 200% declining balance and 15-year property uses 150% declining balance with the half-year convention. All property enters service before October; no mid-quarter convention applies.
The 39-year building uses straight-line and the mid-month convention: 7.5 months in 2026.
Depreciation deductions are not tax savings. Deduction limits and taxpayer circumstances are outside this demonstration.

## Allocation

| Component | Basis | Recovery |
|---|---:|---|
| Parking and striping | $150,000 | 15 years |
| Sidewalks and entry walk | $30,000 | 15 years |
| Concrete foundation | $140,000 | 39 years |
| Masonry and framing | $450,000 | 39 years |
| Windows and entry doors | $110,000 | 39 years |
| Room walls and doors | $100,000 | 39 years |
| Building plumbing | $75,000 | 39 years |
| Building electrical | $95,000 | 39 years |
| Heating and cooling | $110,000 | 39 years |
| Dental equipment plumbing | $95,000 | 5 years |
| Dental equipment circuits | $90,000 | 5 years |
| Tile and permanent floors | $60,000 | 39 years |
| Reception counter | $45,000 | 39 years |
| Operatory cabinetry | $125,000 | 5 years |
| Sterilization cabinetry | $45,000 | 5 years |
| Imaging room shielding | $35,000 | 39 years |
| Restrooms and fixtures | $45,000 | 39 years |
| Staff room cabinetry | $30,000 | 39 years |
| Removable carpet tiles | $25,000 | 5 years |
| Monument sign | $20,000 | 15 years |
| Planting and irrigation | $25,000 | 15 years |
| Parking and path lights | $25,000 | 15 years |
| Roof and rainwater | $75,000 | 39 years |

5-year basis: $380,000. 15-year basis: $250,000. 39-year basis: $1,370,000. Land: $400,000. No 7-year acquisition rows.
Year-one depreciation with 100% bonus: $651,955.13. Without bonus: $110,455.13. Building depreciation is $21,955.13.

## Classification assumptions

The IRS Cost Segregation Audit Techniques Guide describes the Hospital Corporation of America functional analysis and equipment-related electrical allocation. These are applied by analogy to professional-service assets in class 57.0, not as an IRS pre-approved dental allocation. The short-life casework is assumed mechanically fastened, removable intact and reusable with dental equipment; it is distinct from ordinary office furniture under class 00.11. If it were not removable and reusable, it would be part of the building. An actual study rests on invoices, field inspection, circuit tracing, plumbing plans and indirect-cost reconciliation.

The dedicated dental connections include only equipment-serving branches and attributable capacity. None of the general service rows is also counted in the dental rows. Permanent shielding and hygienic adhered floor finishes are 39-year in this example. All loose office furniture is excluded staging.

## IRS sources

- [IRS Publication 946, including Appendix B class 57.0 and asset class 00.11](https://www.irs.gov/publications/p946)
- [IRS Notice 2026-11](https://www.irs.gov/pub/irs-drop/n-26-11.pdf)
- [IRS Cost Segregation Audit Techniques Guide, Chapters 2 and 8 (not authoritative law)](https://www.irs.gov/pub/irs-pdf/p5653.pdf)


## How the services are shown

The shallow blue, amber, violet and green service paths distinguish four functions during installation. Finished flooring conceals them, as real floor-routed services would be concealed. Their enlarged widths are instructional and do not establish physical dimensions or an engineering allocation.