Cost Segregation =
A cost segregation study is a process used for income tax purposes that examines the various components of a property, such as plumbing fixtures, carpeting, and sidewalks, which are typically part of a building acquisition or development. Instead of depreciating these components over the same useful life as the entire building (27.5 or 39 years), the study categorizes them separately. This allows property owners and investors to benefit from an accelerated depreciation timeline for certain building elements, potentially resulting in tax savings.Start Saving Now
Small firms don't do Cost Segs. Big firms charge too much.
Our cost segregation team uses a lean approach that takes advantage of cost efficiencies of batching site visits when engineers are needed on the ground and, when not needed, we deploy other non-engineer professionals who live near the property to perform site visits guided by a remote engineer.Start Saving Now
The "low-cost" providers'
due diligence leaves you
There are more than a few firms out there who do cost segregation studies without an appropriate level of due diligence and documentation. They won’t corroborate their studies with engineers, industry benchmarks or cost seg data on comparable properties. And, they won’t conduct a visit to the property site, even when it’s necessary. These studies cost next to nothing, except when the IRS blows up said “study” hitting the taxpayer with additional tax, penalties and interest. Suddenly, that study becomes quite costly.Start Saving Now
Your tax pro didn’t suggest doing a
cost seg study because you didn’t ask
Most tax pros have very little experience with cost segregation studies and don’t know reputable cost seg firms to refer clients to, assuming they both knew when it would make sense for a client and were capable of delivering the planning advice to the client.
Too many times, this tax planning opportunity is glossed over or entirely ignored.
Which Type of Property Qualifies?
Cost segregation can be done for buildings purchased or built since 1986, and that includes renovations. It’s especially beneficial for large-scale property developers and investors. You don’t need to be big to benefit, though. Cost segregation applies to many types of properties, including, but not limited to:
We’ll perform an evaluation as to whether the tax savings will substantially outweigh the costs, including impacts on timing of cash flows
If it makes sense, our Cost Seg team will kick off the study and will keep you in the loop at each stage of the process
We’ll claim the accelerated deductions on your behalf in the most tax-advantaged manner possible
Are You Ready?
There is a lot to unpack when it comes to each individual's unique tax planning strategies. If you would like to see if we can help, reach out today.Start Saving Now
Suzi Drennen is the most knowledgeable, conscientious, and responsive CPA I have ever known—which is why I’ve stayed with her for more than 10 years. She is honest, has always gotten back to me quickly even at the height of tax season, and has saved me thousands of dollars over the years. The icing on the cake is that Suzi’s easy to work with and on top of that, a great person! She and her firm are tops!