Archive for the ‘Cost Segregation’ Category

By Cindy Lucas

I like to think of it as a gift with purchase. A cost segregation study identifies and reclassifies real property to personal property. Think about your building as a dollhouse, now pick it up and turn it upside-down; everything that falls out is personal property, meaning it can be removed.

Traditionally commercial real-estate is depreciated straight line method over 39 years. Well the truth is that nothing in that building is going to last 39 years. Components like carpeting, pluming, and furniture even down to the wiring in electrical systems should be reclassified. The IRS has released the Audit technique guide, which serves as a reference for an engineering company to allocate these components to 5, 7 or 15 year lives.

What that means is cash flow to the property owner. The typical benefits of a cost segregation study are 7-10% of the purchase price or build cost realized back to the owner within the first five years. Some aggressive CPA firms may be doing some safe methods of accelerating their clients’ depreciation but in no way can achieve or justify the level of benefit that can come from an engineering firm who specializes in this. Afterall, how would a CPA know what your insulation would cost to replace?

Speaking of replace brings me to the insurance aspect. An Engineered Cost Segregation Study gives the ability to substantiate the replacement costs to the insurance carrier. This enables an insurance agent to go to their underwriters for the most aggressive pricing. The underwriter will have a very high comfort level of the risk due to the comprehensive building review in their file.

What if something happens to your building? I am sure we have all played the insurance game and it can be quite frustrating trying to collect for what you need to replace or repair.

A cost segregation study can serve as a substantive document that an owner can use as support to a claim that is being disputed to their favor. The depth of our reports helps an owner to avoid the need to hire a third party professional to justify their claim.

To an underwriter this becomes a disclosure safeguard whereby at time of claim the owner is able to substantiate a full disclosure position with the insurance adjuster which puts the onus on the carrier to pay!

For more information please feel free to contact me directly at 954-439-1671 or email clucas@engineeredtaxservices.com
Cindy Lucas
Director
Engineered Tax Services

Tax Strategies To Increase Building Cash Flow

May 10, 2012

One Riverway, Suite 1000 | Houston, Texas

Join Mark Barbour as he presents the popular and informative presentation for building owners – Tax Strategies To Increase Building Cash Flow over lunch, hosted by Harper Pearson, P.C.. Mark can also assist you to learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details call Mark Barbour on 310.383.1302.

BuildingsNY Conference and Expo

May 2 – 3, 2012

Javits Center, NY, NY

Join Michael D’Onofrio, presenter at Green To Gold Finance and Incentives Panel, May 2, 2012, 10.15 – 11.15am. Also Visit Peter Scalise and Michael D’Onofrio of ETS at our booth number 757. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details click here to visit the registration website.

North American Regional Meeting

May 20 – 22, 2012

The Pfister Hotel, Milwaukee

Join Chris Ostler and Art Goessel at the NARM 2012. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details click here to visit the registration website.

2012 North America Leadership Forum and Audit Group

June 12, 2012

New Orleans

Join Heidi Henderson and Kimberly Merrill at the 2012 North America Leadership Forum and Audit Group. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details click here to visit the registration website.

South Florida IREM Association Lunch and Learn

June 12, 2012

Crowne Plaza Hotel Downtown at 304 W. Colonial Drive, Orlando, FL 32801

Join Julio Gonzalez as he presents the benefits of the 179D Energy Policy Act and Cost Segregation at this lunch and learn hosted by the Institute of Real Estate Management. Also, learn how ETS can assist you with specialty tax benefits to increase the ROI in your and your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details contact Meridythe Kanaga, CPM, Phone: 407-862-2292 ext. 1004, or Email: admin@irem-centralfl.org

CICPA Annual Conference

July 18-20, 2012

Embassy Suites – Chicago IL

Join Michele Pino at Construction Industry CPA’s/Consultants Industry Annual Conference. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your and your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details click here to visit the registration website.

Baker Tilly International, 2012 North American Regional Conference

June 6 – 12, 2012

Vancouver, Canada

Join Julio Gonzalez, Kimberly Merrill and Heidi Henderson at the the Baker Tilly North American Conference. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details contact Kimberly Merrill on 801.589.0779

AICPA National Tax Conference

November 7 – 8, 2012

Marriott Wardman Park
Washington, DC

Join ETS at the AICPA National Tax Conference. Learn how ETS can assist you with specialty tax benefits to increase the ROI in your client’s business.  Specialty tax benefits include Green Energy Tax Deduction, Research and Development Tax Credit, Repairs and Maintenance Studies, Cost Segregation Studies, Energy Star Benchmarking and Certification and more.  For details click here to visit the registration website.

Reclassifying Business Personal Property to Achieve Income and Property Tax Benefits

Hosted by Strafford Publications, This is A live 110-minute CPE teleconference with interactive Q&A

Thursday, April 5, 2012
1:00pm-2:50pm EDT, 10:00am-11:50am PDT

This teleconference will review best practices and commonly followed standards in conducting a cost segregation study as performed by corporate tax professionals and advisors handling both income and property taxes.

Description

A thorough cost segregation study can materially reduce federal income taxes (by segregating personal property such as equipment, furniture, electrical systems, etc.) that can be depreciated over five, seven or 15 years) and property taxes (by separating real and personal property taxed at different rates).

Other potential benefits include timed depreciation deductions to maximize cash flow, creation of strong documentation for audits, and capture of retroactive savings for new or remodeled properties added since 1987. However, taxpayers cannot be too aggressive, lest they incur depreciation recapture or penalties.

What level of internal and external expertise is needed to produce a reliable cost segregation study? How closely should you follow the IRS Cost Segregation Audit Techniques Guide? What are the elements (e.g., review of all cost records, facility inspection, photographs) of a study that follows best practices?

Listen as our panel of advisors with considerable experience in cost segregation studies offers their standards and experiences to help you refine your own approach.

Outline

1. Reasons to perform a cost segregation study

1. Separating non-structural elements, exterior land improvements and indirect construction costs
2. To identify construction-related costs that can be depreciated over a shorter tax life
3. Adjust the timing of depreciation to maximize cash flow for other purposes
4. Create a defensible audit trail
5. Immediately recapture retroactive savings on property added since 1987
6. Reduce property taxes

2. Eligible real property

3. Features of the cost segregation study process

4. Internal and external resources

1. Need for a construction engineer
2. Applicable standards and guidance
3. Experiences from prior studies

Benefits

The panel will explore these and other relevant topics:

• Standards and guidance from the IRS, American Society of Cost Segregation Professionals and elsewhere.
• Proper timing for a study, be it done post-purchase, in the year a property is placed in service, or pre-construction.
• Features and documentation in a high-quality cost segregation study.
• How to minimize the potential downsides arising from conducting a study.

Following the speaker presentations, you’ll have an opportunity to get answers to your specific questions during the interactive Q&∓A.

Upon completing this seminar, you will have new approaches and alternatives to consider in performing an effective cost segregation study that separates personal from real property assets, for tax reporting purposes.

Faculty

Daniel McGrath, Director
Grant Thornton, Chicago

His client work focuses on capital cost recovery services, and he has more than 18 years of experience in cost segregation work. He previously was central region director of cost segregation services for Ernst & Young.

Gian Pazzia, Principal
KBKG Inc., Pasadena, Calif.

He oversees all of the firm’s cost segregation services nationwide. He is co-chair of the American Society of Cost Segregation Professionals’ technical standards committee and previously worked with cost segregation groups at two Big Four firms.

Julio Gonzalez, Founder and CEO
Engineered Tax Services, West Palm Beach, Fla.

He is a regular public speaker at a national level regarding cost segregation studies. His firm works on a number of engineering, architecture and accounting engagements.

Dennis Duffy, President
Duffy + Duffy Cost Segregation Services Inc., Westlake, Ohio

He has performed engineering-based cost segregation studies nationwide since 2002 after working in the construction industry and tax law. He writes and speaks frequently on cost segregation topics.

To attend this webinar, or download the presentation materials, listen to the webinar or learn more about this session, click this link.  CPE Credits apply.

li