When To Use a Cost Segregation Study
What Qualifies for Cost Segregation Studies
Why Should I Do a Cost Segregation Study?
A Cost Segregation Study will do three important things:
- Create Immediate Tax Savings
- Increase Cash Flow – by accelerating depreciation deductions and deferring income tax payments.
- Catch – Up Prior Year Accelerated Depreciation – Cost segregation studies allow a client to “catch-up” previously under-reported depreciation without filing amended tax returns. All “catch-up” depreciation can be taken in the current year tax.
But, most importantly, it puts cash in your pocket now. Let us help you utilize the benefits of a cost segregation study that tens of thousands before you have benefited from.
Cost Segregation Opportunities
- New construction
- Purchase of existing property
- Renovations or expansion
- Leasehold improvements
- Existing property placed in service after 1986 (“look-backs”)
- Real property stepped-up through estate
- 1031 Exchange Properties (the replacement and the give up property)
Cost Segregation Qualifications
Legal Entity Structure/Basis
- Pass Through Entities
- Partnerships, LPs, LLPs
- S Corps
- Certain Trusts
- Motivation of Taxpayer
- Depreciation Recapture — Hold Property or Sell Eventually?
- Net Passive Loss
- Alternative Minimum Tax (“AMT”)
ADDITIONAL LINKS: • Relevant Court Cases – IRS
If you own property valued above $750,000, CSConsultants can help reduce the current tax liability with professional, “engineering-based” cost segregation studies. Call CSConsultants at 1.801.647.5225 for a complimentary benefit analysis of savings and fees.