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COST SEGREGATION SERVICES

Cost Segregation is the practice of identifying assets and their costs, and classifying those assets for federal tax purposes. In a cost segregation study, certain costs previously classified as subject to 39-year depreciable life, can instead be classified as personal property or land improvements, with a 5, 7, or 15-year rate of depreciation using accelerated methods.

An appraisal from a Certified Appraiser trained to perform a site inspection and determine the value of any eligible machinery/equipment and personal property allows a building owner to depreciate a new or existing structure in the shortest amount of time permissible under current tax laws.

The benefits of a cost segregation study include:
  • An immediate increase in cash flow
  • A reduction in current tax liability
  • The deferral of taxes
  • The ability to reclaim “missed” depreciation deductions from prior years (without having to amend tax returns)

Cost segregation studies are one of the most valuable tax strategies available to owners of commercial real estate today. This increasingly popular phenomenon, offers facility owners the opportunity to defer taxes, reduce their overall current tax burden, and free up capital by improving their current cash flow. Virtually every taxpayer who owns, constructs, renovates, or acquires a commercial real estate structure stands to benefit from a cost segregation report.