Cost Segregation Analysis in Los Angeles, California
Cost segregation is a tax strategy that involves identifying and separating personal property assets from real property assets for tax reporting purposes
It works by allowing real estate investors in Los Angeles to more quickly deduct the depreciation of a property against their taxable income, which is beneficial across various types of investment properties, from single-family homes to larger commercial buildings
A cost segregation study in Los Angeles specifically dissects the construction cost or purchase price of the property into components that can be depreciated over shorter periods, like five, seven or 15 years, instead of the standard 27.5 or 39 years. This approach aims to identify all property-related costs that are eligible for accelerated depreciation, thus offering a more favorable tax treatment
Find Out if You Qualify for Cost Segregation in Los Angeles
If you’re a corporation, partnership, trust or individual with Los Angeles real estate purchased or built within the past 15 years with tax liabilities you can benefit from a cost segregation study.
Because a cost seg study dissects the construction cost or purchase price of the property that would otherwise be depreciated over 27.5 or 39 years, both residential and non-residential commercial properties both qualify.
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Frequently Asked Questions
How Much Should a Cost Segregation Study Cost?
The fee for a cost segregation study in Los Angeles should be between $3,000-$12,000. However, the capital outlay is more than worth it, considering you can save hundreds of thousands, if not millions, in taxes by commissioning a study. The ROI is amazing.
What Is Included in Cost Segregation?
Cost segregation professionals in Los Angeles will survey your building’s subcomponents, like lighting fixtures, heating and air conditioning systems and other components that deteriorate over time. It assigns five- or 15-year lifespans to these subcomponents. Then the study assesses how much in taxes you can write off because of your financial loss from these aging subcomponents.
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