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Old 07-18-2007, 05:14 PM
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Cost Segregation ?

Thanks Fred you're the best!


Last edited by SherryC : 07-23-2007 at 04:40 PM.


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Old 07-18-2007, 05:31 PM
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Cost Segregation Services

Cost Segregation is the process of identifying personal property assets that are grouped with real property assets, and separating out personal assets for tax reporting purposes. A Cost Segregation study identifies and reclassifies personal property assets to shorten the depreciation time for taxation purposes, which reduces current income tax obligations. Shorter life property assets include a building’s non-structural elements, exterior land improvements and indirect construction costs.

Analysis of capital expenditures is used to determine appropriate asset classifications. Cost Segregation identifies building costs that would typically be depreciated over a 27.5, 31.5 or 39-year period and reclassifies them to permit a shorter, accelerated method of depreciation for certain building costs. Costs for non-structural elements, such as, carpet, accent lighting, portions of the electrical system, and exterior site improvements such as sidewalks and landscaping, can often be depreciated over five, seven or 15 years, rather than over 27.5, 31.5 or 39 years.

Cost segregation studies are ideally commenced during the design phase of a new construction project or directly following the close of an acquired property. Significant benefits can also be achieved for properties that were placed in service from past years. Were a cost segregation study not conducted by the current owner when it was initially placed into service, a change in accounting method can usually be employed, permitting formerly missed depreciation expenses to be deducted all in the current tax period. The result is an immediate, and often significant, catch-up deduction.

DC Consulting are Cost Segregation Specialists and provide Engineered Cost Segregation services to businesses with real estate investments. Our service is to help our clients find a better return on their investments, find more cash flows, and ultimately build a better business.


Last edited by Millerlite : 07-18-2007 at 05:38 PM. Reason: forgot to put hyperlink


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Old 07-18-2007, 06:25 PM
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Cost Segregation Studies - Overview

Actually, I am familiar with this concept quite well and here is my take on this subject. First of all, it is a fact that:

" It has been well known by the Tax experts that "changes in the 1987 tax law and recent court case rulings have identified certain assets that are subject to an accelerated depreciation method enabling real estate owners to reap the benefits of increased tax write-offs through a rapid depreciation and thereby resulting in a potential reduced tax liability".

Some of the assets that are subject to an accelerated depreciation are as follows:

1.Site improvements
2.Suite uilities
3.Site Municipal Systems Infrastructure
4.Furniture and Equipment and Equipment(FF & E)
5.Specific Equipment such as pnematics, hyrdraulics
6.Capital equipment

The cost recovery specialists would basically show you how you can take advantage of this rapid depreciation write-off and hopefully their study report will enable you to properly capitalize your assets in the appropriate category that would offer the best option for gaining maximum current year depreciation.

This Cost Segregation study is not cheap generally, and it requires a team of highly technical competence in Engineering, Construction, Estimating and Tax discipline. These reports are also very sophisticated in nature and generally for big commercial projects they generally yield a much better ROI.

Clearly, and I would recommend that you consult your CPA first to determine whether this study makes sense for you financially and that is appropriate for your situation.

If you need help, please contact me directly and I can provide you with a very reputable company to assist you in this matter.

__________________
Find a CPA near you!

Ask TaxGuru Please refer to the legal disclaimer.


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Old 07-18-2007, 08:15 PM
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recomendations

Dear Taxguru,

Can you please recommend a reputable cost segregation firm in the Los Angeles area. Thank you again for the information.

RE: I tried previously to respond to the posts here but it doesn't show for some reason. I just wanted to thank TaxGuru for recommending S Appleby, and to tstevens. I visited both of your websites but was unable to find a Los Angeles office so we may discuss the project in person. I did however receive some very helpful information from fredback523. Thank you again.


Last edited by SherryC : 07-23-2007 at 12:09 PM.


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Old 07-19-2007, 06:12 PM
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Hi SherryC,

I work for Cost Segregation Partners which is the leading cost segregation firm in the U.S. Our Cost Segregation business unit is part of Friedmax & Battaglia, the 10th largest accounting firm in the nation and our sister company is RSM McGladrey, rated #5 in the nation. Our firm has done thousands of Cost Segregation studies. You can look at our website at: Cost Segregation Partners | Book: Real Estate Cost Segregation: A Practitioners Guide. I would be happy to meet with you and discuss how we can help you with your Cost Segregation needs. Please, contact me at my office number: 949-760-4722 or e-mail me at [email protected]. I look forward to talking with you.

Sheri Appleby
CSP Consultant
Real Estate Financial Corp
Cost Segregation Partners
Cell: 949-290-5747



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