Cost Segregation Studies
Cost Segregation Studies can potentially save property owners thousands of dollars over multiple years. The savings come through properly allocating costs between real property and personal property for tax depreciation.
A cost segregation study is an analysis of the capital expenditures or investment made in a residential or commercial building, such as a manufacturing facility, apartment building, restaurant, medical office, retail store or office building.
Why Conduct a Cost Segregation Study?
Direct benefits of cost segregation studies include:
- Reduce corporate and individual income taxes
- Reduce real estate taxes by shifting value from real property to personal property
- Reduce personal property taxes by accelerating the write-down of personal property
- Increase corporate after tax net income by reducing the corporation’s effective tax rate
- Help provide corporations and investors with increased cash flow
- Help investors maximize the tax credits they can claim
- Provide investors with additional cash to reinvest in new projects
- Allow a corporation or investor to claim "catch-up" depreciation on assets that have been previously misclassified as real property
- Help investors and corporations manage their investments in capitalized assets
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