What You Need to Know About Cost Segregation Planning

1
What You Need to Know About Cost Segregation
Planning

• By - https//engineeredtaxservices.com/cost-segre
  gation/

2

• Cost segregation planning can be confusing when
  you dont understand what it means when you
  should use it, and what it can do for your
  business or clients. Understanding cost
  segregation planning is a tool you can use to get
  a significant cash flow, a decrease in tax
  liability, and the ability to defer taxes, and an
  opportunity to reclaim past depreciation
  deductions.

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What is cost segregation planning?

• Cost segregation planning is a commonly used
  strategic tax planning tool that allows companies
  and individuals who have constructed, purchased,
  expanded, or remodeled any kind of real estate to
  increase cash flow, accelerate depreciation
  deductions, and defer tax.
•  
• Cost segregation services are primarily used to
  reduce depreciable costs in buildings that are
  27.5-39 years old.

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When should I do a Cost Segregation Study?

• The best time to do a study is usually after a
  remodel, immediately after the purchase, or
  construction of a property within the first year.
  This will help you get maximum tax benefits.
•  
• Even if your building was purchased, built, or
  remodeled a few years before, you can still
  benefit from a cost segregation planning study.

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What Items are Reclassified in the Study?

• -Appliances
• -Flooring
• -Countertops
• -Signage
• -Lighting
• -Cabinetry
• -Landscaping
• -Sidewalks
• -Parking lots

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What Properties Qualify?

• There are a lot of different types of properties
  that qualify for a cost segregation planning
  study. Office buildings, retail centers, banks,
  restaurants, grocery stores, and auto dealerships
  can all qualify. Golf courses, theaters,
  apartment buildings, manufacturing facilities,
  and hotels/motels can qualify as well. If you are
  not sure if your building will qualify for a
  study, you can consult a tax engineering firm.

7
How Long Does a Study Take and What Documents Do
I need?

• On average, a study takes 1-2 months or 30-60
  days. How long a cost segregation planning study
  takes is usually dependent on how large the
  project is, and if all the documents are provided
  upfront.
•  
• When starting a cost segregation planning you
  will want to have your documents ready to get the
  study done efficiently. You will need
•  
• -Construction contract budget
• -Architectural drawings
• -Contractors payments through the project
• -Change orders
• -Contractor final payment
• -Final Project costs

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Who Should Conduct My Study?

• You should have a professional with experience in
  engineering, architecture, construction, and tax
  accounting to do your study. Engineered Tax
  Services will take care of all your tax needs. We
  are dedicated to helping you uncover potential
  tax-saving and increase cash flow through
  reclassification and depreciation of property.