Has your company constructed, purchased, expanded or remodeled real estate? If so, you may be eligible for hundreds of thousands in tax savings through a cost segregation study.
Cost segregation is a commonly used strategic tax planning tool that reduces taxable income and increases cash flow by accelerating depreciation deduction. Certain components of your property, including all exterior and interior structures, may be separated from the rest for faster depreciation and tax savings.
For example, rather than 27.5-year (residential) or 39-year (commercial) depreciation for your structure, assets can be broken into 5 or 7 years for personal property and 15 years for personal property. In fact, 25% or more of the cost of your building may be able to be reclassified. To determine the depreciation rate, the first step is a cost segregation study.
Many business owners and executives are curious about cost segregation studies but are not sure if their business qualifies. The primary goal of the cost segregation study is to determine which components of your property costs can be separated out and depreciated over shorter time periods, therefore speeding up the related tax deductions.
A cost segregations study is the review of a building by a qualified individual to identify those items which qualify for quicker depreciation. The IRS requires an engineer-based report to support the acceleration of depreciation.
Tax Point Advisors works with CPA firms and business owners to coordinate the cost segregation study. We offer in-house engineering capabilities and the tax expertise to help you quantify the amount of tax savings you could receive. We also will identify any obstacles preventing a property owner from fully realizing their tax-savings potential.
To learn more about tax benefits from cost segregations studies, simply fill out the form on this page and a member of our team will be in touch with you. Or, you may call us at (800) 260-4138 nationwide.