Cost Segregation

Building Tax Savings You Can Use

When the dust settles on your expensive new building project, or your purchase of an existing facility, your first thought may likely be, “How quickly can I recoup some of my investment?”

Depreciation on real property (buildings) can last up to 39 years – so you won’t see a lot of tax savings in any given year. But a tax strategy called cost segregation can reclassify some building components as personal property, which can frontload your savings over a much shorter period: one to 15 years. That’s savings you can pour into a new capital investment.

Does this strategy make sense for your company? Barnes Dennig’s tax team can tell you.

About cost segregation

Cost segregation is a way of speeding up tax depreciation by reclassifying a building’s components. This strategy works for companies that:

  1. Have purchased, constructed, or renovated a building in the last 15 years; or
  2. Are planning a future expansion that will cost $500,000 or more

Talking with a  cost segregation specialist is the only way to know how this strategy could benefit you. The study should be conducted by experienced technical advisors like ours – advisors who know the nuances of tax laws and rulings and the depreciable lives of business assets.

How Barnes Dennig helps

We’re meticulous about taxes. That’s why:

  • We know your building project is unique, and we approach your cost segregation study differently than anyone else’s. Not only will this maximize your potential tax savings, it’s also likely to reduce the risk of IRS scrutiny.
  • When we do a study on a completed building project, we’ll work with you to file your documentation with the IRS.
  • For new buildings under construction and existing ones you’re improving, we’ll work with your general contractor and subcontractors to build a solid asset record. That means analyzing documentation such as:
    • Blueprints
    • Project specifications
    • Payment records
    • Purchase orders
    • Change orders
    • Field work orders
    • Indirect fees
    • Invoices

Contact us to get every tax deduction you deserve.


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