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| "Will A Cost Segregation Study Save
Me Any Money?" |
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A
Cost Segregation Study usually generates an additional depreciation
of approximately 35% to 47%. |
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"What
Does A Cost Segregation Study Cost?" |
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On
the average, our experience has been that the total fee will
generally fall between 10% and 20% of the estimated NPV tax savings.
This can be impacted by how large or small the real estate project
is. In addition, the location, accessibility, and quality of the
records and documents impact the ultimate cost. |
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"What
Is Net Present Value (NPV)?" |
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Net
Present Value is the calculation of the present value of tax savings
achieved over the 39-year depreciation period (life of the asset). |
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"How
Long Does A Cost Segregation Study Take?" |
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A
Cost Segregation Study normally takes about 4 to 6 weeks from the
time we receive all of the appropriate documentation. |
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"We
Will Get The Deduction In The Future Anyway." |
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True.
However, a Cost Segregation Study in effect gives you an interest free loan
from the government for the first 15 years, which you will then repay interest
free over the remaining 25 years. Wouldn't you rather hold your money? There are
also advantages to doing a study if the building is going to be sold or upon the
death of a building owner. The
present or future value of the money you can save by having a Cost
Segregation Study is usually quite
substantial. Have the cash now to reinvest it! |
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"How
Much Can Be Accelerated?" |
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Certain
types of commercial property can be grouped together to give us an
idea of the percentage of those types of buildings that have been
eligible for accelerated depreciation. Your results may be greater,
or they may be less than those quoted here, but in general, property
that falls into one of these categories is most likely to result in
accelerated depreciation within these ranges. |
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| Building
Type |
Average Building
Costs Eligible for Accelerated Depreciation |
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Spec
Office/Industrial
Office
Buildings
Light
Manufacturing
Heavy
Manufacturing
R&D
Facilities
Senior
Living Facilities
Health
Care
Apartment
Buildings |
|
5
- 10%
10
- 20%
20
- 40%
30
- 60%
30
- 60%
15
- 25%
15
- 30%
15
- 25% |
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"My
Current CPA Can Probably Do A Cost Segregation Study For Me." |
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Not
all CPAs have experience in Cost Segregation Studies. If your CPA
firm is not experienced in this area, we will gladly work with them
on a consulting basis to complete the work for you. |
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"What
Will Be Needed To Complete A Cost Segregation Study?" |
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A
complete set of construction plans, current tax depreciation
records, building cost budget information, final AIA application and
a document of certification for payment or other cost information,
change orders, direct or indirect costs paid by the owner that are
not included in other documents, and any other information depending
upon the project. |
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"If
I Don’t Have the Necessary Materials, Can A Cost Segregation Study
Still Be Performed?" |
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Yes,
our construction, engineering and other specialists can do an
extensive site visit. They will measure and estimate using currently
accepted costing techniques and pricing guides to determine the
costs that qualify for shorter recovery life periods. |
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"I
Have My Own Engineers and Architects. May I Use Them?" |
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It
is most cost efficient and beneficial for us to use engineers and
architects who are familiar with and specialize in Cost Segregation
Studies. They know the components that qualify and are experts in
how to document and substantiate their work. Consequently, their
work also better withstands IRS scrutiny and they are able to assist
with any IRS challenges. |
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"How
Much Does A Feasibility Study Cost?" |
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A
feasibility study is free. |
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"I'm
Afraid My Chances Of Being Audited Will Increase After A Cost Segregation Study Is
Completed On My Property." |
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The
chance of being audited does
not substantially increase after a Cost Segregation Study. |
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"Will
Costsegs Assist Me In The Event Of An Audit?"
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Yes.
We and our specialists can assist you in the event of an audit. Our
focus in
doing the Cost Segregation Study is to create
documentation and support for our conclusions so that they are
easily communicated and resolved with the IRS. |
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"How
Much Can I Save?" |
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Click
here
to fill out our Information Request Form
so we can give you the answer! |
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"Who
Do I Call For More Information?" |
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For more information on Cost
Segregation Studies or any of our other services, contact us at
716-633-9840.
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