What is Cost Segregation?
Whether you have or are constructing a new building, expanding an existing facility, purchasing a new facility, or updating an older facility your property can cause much bigger tax savings than you are used to. Substantial tax and cash flow opportunities can be achieved for those who employ the available tax opportunities.
A cost segregation study (“CSS”) is an engineering-based study of all costs associated with the construction, expansion or acquisition of a building. The purpose of this is to classify these costs as either real or personal property, with the personal property additions being depreciated on an accelerated basis. Normally, the deprecation basis for these assets are between 27 and 39 years. However, through a proper cost segregation study, some of these costs may qualify for a 5, 7 or 15-year depreciable period, resulting in a savings of up to 22%.
Properties with the best savings potential include:
| Best Property Possibilities |
Office Buildings |
Hotels and Motels |
Apartment Facilities |
Manufacturing and Industrial Plants |
Retail Stores and Chains |
Shopping Centers |
Medical Facilities |
Warehouses and Distribution Centers |
Restaurants |
Typical percentages of accelerated properties: |
Manufacturing |
20-60% |
Hotels |
15-40% |
Apartments |
20-50% |
Restaurants |
10-40% |
Office Buildings |
10-40% |
Research & Development |
20-50% |
Hospitals |
20-50% |
Tenant Improvements |
15-50% |
Retail |
15-40% |
Grocery Stores |
15-50% |
A proper CSS requires an engineering based study, which consists of; knowledge of income tax regulations, materials, and construction methods. Our detailed cost segregation studies pay for themselves many times over, starting with the first year the property is placed in service.
Huge Pay-offs For Real Property.
Our expert team of examiners and engineers has the experience in construction, project design and tax law to afford you huge savings from a Cost Segregation Study. The IRS allows and has approved this for any and all real and personal property. Let us show you how to increase your operating capital overnight. Call us now for a free feasibility study. |