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Can CSS Help in Increasing The Rate of Return

Cost segregation is a specialized and powerful tool that analyses capital costs and allocates costs between different depreciable lives. Cost segregation accurately allocates property components for federal income tax depreciation calculations.

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55 views7 pages

Can CSS Help in Increasing The Rate of Return

Cost segregation is a specialized and powerful tool that analyses capital costs and allocates costs between different depreciable lives. Cost segregation accurately allocates property components for federal income tax depreciation calculations.

Uploaded by

Expert costseg
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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www.expertcostseg.

com

CAN CSS HELP IN


INCREASING
THE RATE OF RETURN?
An Introduction to CSS
Cost segregation is a specialized and powerful
tool that analyses capital costs and allocates
costs between different depreciable lives.

Cost segregation accurately allocates property


components for federal income tax depreciation
calculations.

Cost segregation study benefits include increased


cash flow, improved ROI, reduced taxes and
the ability to catch-up on past years.
Industries that benefit
from a CSS
Apartments Manufacturing units
Hotels Warehouse
Office buildings Storage
Shopping centers Restaurants
Retail Fast food facilities
Drug stores Auto dealership
Private schools Banks
Medical buildings REIT's and green buildings.
Nursing homes
Funeral homes
Bonus Depreciation &
Cost Segregation
Bonus depreciation allows you to immediately
deduct a certain percent of the assets cost in
the very first year it was placed into service

Assets that are reclassified as personal property


are eligible for bonus depreciation and can be
expensed in the very first year

It is not necessary that a CSS should be done in


the year of acquisition, it can also be performed
on properties that were place into service in a
prior year where the tax returns were already filed
Can CSS help in increasing
the rate of return?
A cost segregation study assesses your real
property assets and then identifies those assets
that can be treated as personal property

Once identified, a CSS reassigns the costs over


a 27.5-year or a 39-year period to the asset
group that has a shorter recovery life

About 20 to 35 percent are reclassified to tax


lives of 5,7 or 15 years

Hence, huge tax deductions are available in the


early years of investment rather than it would
be using a straight line depreciation over a 27.5
or 39 years.

This in turn increases cash flow and reduces tax


liability
Final Thoughts
Commercial property owners planning to hold their real estate
over a long run can benefit from a cost segregation study

Professionals with expertise in the field can help you identify


If the benefits from a CSS will outweigh the costs.
www.expertcostseg.com

Thank You

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