Maximize Tax Savings with
Cost Segregation
Bonus depreciation and accelerated depreciation deductions for increased cash flow
Save Money on Income Taxes
As a building owner, you can take more depreciation earlier on in the life of the ownership of your building by doing cost segregation. You might be able to use bonus depreciation, catch up depreciation or acclerated depreciation. Either way, you win by keeping more of your hard earned income in your bank account rather than sending it to the IRS.
Running a business and owning real estate is hard enough without paying more in tax than you need to. Find out what thousands of owners already know and get your estimate for cost segregation.
Our Services
If you own a commercial building or a residential investment property, discover how we might be able to help you reduce your income taxes.
Cost Segregation Studies
Engineering-based cost segregation is a tax strategy used primarily in the U.S. by property owners who have purchased, constructed, expanded, or remodeled any kind of real estate where the owner receives a rent or lease payment. . The purpose of this method is to increase cash flow by accelerating depreciation deductions and deferring federal and state income taxes. Cost segregation reclassifies the building components from their 39 year (commercial) or 27.5 year (residential investment) class lives. By identifying 5 and 15 year property, the owner is able to take more depreciation earlier in the life of the ownership boosting cash flow and lower income taxes.
Partial Asset Disposition Studies
Partial asset disposition is a tax strategy used by commercial building owners to manage their financial obligations when they dispose of or renovate parts of their property. This approach can be particularly valuable when specific components of a building, like HVAC systems, roofing, or interior finishes, are replaced before the end of their depreciation schedule.
By taking advantage of partial asset disposition, a commercial building owner can write off the remaining undepreciated value of the disposed parts of the property in the year of disposition. This allows the owner to claim a tax deduction for the loss on the value of the old component that has been removed and replaced, thereby reducing the overall tax burden.
179D Studies
The Section 179D tax deduction, part of the U.S. Internal Revenue Code, offers significant tax incentives for commercial building owners who implement energy-efficient improvements to their buildings. This provision was established by the Energy Policy Act of 2005 and has since been updated periodically, most recently by the Inflation Reduction Act in 2022.
Capitalization to Expense Reversals
Capitalization to expense reversals are a financial concept related to the accounting treatment of costs incurred in the context of owning and managing commercial real estate. This process involves changing the classification of certain costs from being capitalized (i.e., added to the value of an asset on the balance sheet) to being expensed (i.e., reflected immediately in the income statement as an expense). This adjustment can impact both the balance sheet and the income statement of a commercial building owner. The result can be very significant tax savings. We can review your depreciation schedule at no charge to see if we believe there may be some items that could be reversed.
Unlock Tax Advantages Now
Schedule a Call with John Murphy
864-276-1448
Let’s discuss your buildings and see if we can unlock substantial tax benefits for you
Cost Segregation
Reclassify building components to 5, 7 and 15 class lives for maximum depreciaton, more cash flow and lower income taxes
Improvement Studies – Partial Asset Disposition
Improving a building with signicant renovations? It probably should be studied. This tax benefit is missed by most building owners.
179D Energy Tax Savings
Tremendous depreciation tax strategy if your building qualifies.
Capitalization to Expense Reversals
Identification of items capitalized that should have been expensed.
Our Process
Efficient steps to maximize tax savings
Document Collection
We will collect all relevant documentsfor our engineering team to be able to evaluate and reclassify your building’s components. Items such as closing statement, depreciation schedule, building plans, renovation plans, cost detail, survey, floor plan. We will also do an on-site visit and take our own photographs documenting the building.
Engineering Analysis
Precise classification to optimize depreciation benefits. Our engineers with go over all the documentation as well as the site visit pictures to properly and accurately reclassy your building into its correct class lives – 5, 7, 15 and 27.5 or 39 year property. This generally takes 5-6 weeks to complete.
Tax Reporting
Thorough documentation for IRS compliance. You will receive the detailed cost reports for each building as well as documentation for the key building systems – their depreciable value today as well as their replacement costs. This will be everything your tax professional will need to apply this to your taxes for tax savings.