WHAT is a Cost Segregation Study?
Property owners of commercial and investment real properties typically depreciate their real estate holdings over 39 years or 27.5 years (residential property). However, the IRS has provided guidelines to identify certain components of a building and reclassify them as shorter-life assets. The reclassification could mean the property owner can take larger tax deductions over a shorter period, i.e., tax savings and improved cash flow.
HOW does a Cost Segregation Study work?
A Cost Segregation Study, conducted by the IRS’ preferred method, consists of a detailed examination of construction and accounting records by a professional consultancy comprised of accountants and engineers. Estimates are used to supplement the actual cost detail when the existing detail is not sufficient. Then, the study will identify the specific components of a building that can be reclassified as 5, 7, and 15-year life assets. Some examples of such components include accent lighting, carpet, cabinetry, floor covering, signage, paving, sidewalks, landscaping, specialty plumbing, electrical and HVAC equipment.
Our team members are intimately familiar with cost segregation studies and ablet to advise our real estate clients when a Cost Segregation Study should be considered.
How can we help?
San Antonio Office
Mon-Thu: 8 a.m.–5p.m., Fri: 8 a.m. – Noon
Extended Tax Season Hours:
February 1 – April 15
Mon – Fri: 8 a.m. – 6 p.m.
Sat: 8 a.m. – Noon
New Braunfels Office
Mon-Fri: 8 a.m.-5p.m.
11955 Network Blvd,
San Antonio, TX 78249
417 W San Antonio St #200
New Braunfels, TX 78130