Benefits of a Cost Segregation Study

The amount of savings realized will vary depending on your specific expenditures, business operations, and other financial factors.  However, most facilities usually derive benefits such as:

• Increased cash flow (resulting in increased cash available for new projects) through accelerated federal tax depreciation of construction-related costs

• Substantially reduced corporate and possible individual income taxes

• Net present value savings on federal tax depreciation

• Potential reduction of state and local real estate and personal property taxes

• Our independent analysis, which we will provide and which can be used in the event of IRS scrutiny.

• Increase corporate net income (after tax) by reducing the corporation’s effective tax rate

• Help investors maximize the tax credits they can claim

• Allow a corporation or investor to claim “catch-up” depreciation on assets that have been previously misclassified as real property

• Help investors and corporations manage their investments in capitalized assets

Reclassifying a building or leasehold improvement from the traditional 39-year depreciation period to a five-year classification results in a net present value benefit of 21 cents on the dollar.  A switch to a seven or fifteen-year classification would represent a 19 cents and 11 cents net present value benefit, respectively.