Are you paying more in federal taxes than your fair share? Well, if you own buildings, you could be; and a cost segregation study could provide you with the relief you’ve been looking for.
On this episode of unsuitable on Rea Radio, we’re joined by Dave McGuire, co-founder & director of McGuire Sponsel, a regional professional services firm that works with CPAs to enhance relationships through innovative tax strategies. He’s going to break down the topic of cost segregation for us by shining some light on who can benefit from a cost segregation study, what kind of savings are at stake, and when business owners should take advantage of this strategy.
Case Study: McGuire Sponsel partnered with Rea & Associates to perform a cost segregation study for a manufacturer. This analysis was completed on the purchase and renovation of a manufacturing facility in Ohio. The investment totaled $2,791,500 with a land value of $65,557. The depreciable basis of the property totaled $2,725,943. McGuire Sponsel professionals were able to reclassify 43 percent of the total depreciable property into 5, 7 or 15-year properties. The accelerated depreciation deductions resulted in an increased cash flow of $302,752 over the first five years and a net present value of $220,793 over the life of the investment.
If your business owns property, you will be interested in these other topics discussed in this episode:
- What a cost segregation study is and what type of business can benefit from one.
- The benefits of completing a cost segregation study (with examples).
- How you can use cost segregation (and other similar tools) to plan in today’s uncertain tax environment.
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official transcript
Click here to read the official transcript for episode 104, “how a cost segregation study can save your business (a lot of) money.”