maryland cost segregation cost studies maryland accounting firms performing cost studies
maryland cost segregation cost studies maryland accounting firms performing cost studies
QUESTIONS & ANSWERS
How Does a Cost Segregation Study Decrease Your Taxes?
What is Your Return on Investment for a Cost Segregation Study?
Who Should Consider a Cost Segregation Study?
What is Needed for a Proposal and Tax Savings Estimate?
 
COST SEGREGATION SERVICES
 
Whether you are constructing, purchasing or expanding a building or relocating, KAWG&F can show you how your new property can significantly increase your cash flow by accelerating tax deductions. This process can also apply to past purchases, expansions, renovations, leasehold improvements, and step-up in basis of property currently owned.
How Does a Cost Segregation Study Decrease Your Taxes?
 
A cost segregation study carefully breaks down construction and/or acquisition costs and allocates them to specific asset categories, maximizing depreciation for qualifying costs. Our study allocates such costs to personal property asset classes with lives shorter than real property asset classes. The shorter the depreciation period, the greater your tax deductions and cash flow.
The 2002 and 2003 Tax Acts plus recently issued Internal Revenue Service Procedures include provisions making the potential results of a cost segregation study more beneficial than ever.
These new provisions include bonus first year depreciation for certain assets (generally, those with a useful life of less than 20 years and certain commercial leasehold improvements). This bonus is 30% for assets acquired after September 10, 2001 and before January 1, 2005, and 50% for assets acquired after May 5, 2003 and before January 1, 2005.
Additionally, adjustments to depreciation for "missed depreciation deductions from prior years determined as a result of a cost segregation study" can be reported as an automatic change in accounting method and deducted 100% in the year of the change rather than deducted over a four year period as previously required.
A KAWG&F cost segregation study is based on an engineering approach combined with workpaper documentation that provides the kind of detail and support generally required by the IRS and Tax Court.
What is Your Return on Investment for a Cost Segregation Study?
 
Substantial tax and cash flow savings can be achieved by taxpayers who properly classify their construction or acquisition costs between real and personal property. Every $1,000,000 reclassified from 39 years has an after-tax present value* of:
maryland_accounting_and_tax_returns_cost_segregation maryland cost segregation cost studies maryland accounting firms performing cost studies $220,000 for 5-year property
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation $200,000 for 7-year property
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation $120,000 for 15-year property
 
For residential rental property, every $1,000,000 reclassified from 27.5 years has an after-tax present value* of:
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation $180,000 for 5-year property
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation $ 80,000 for 15-year property
 
Who Should Consider a Cost Segregation Study?
 
Owners of properties such as:
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Apartments
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Car Dealerships
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Golf Courses
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Grocery Stores
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Hospitals/Clinics/Medical Offices
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Hotels/Motels
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Industrial Buildings
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Manufacturing Plants
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Office Buildings
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Parking Lots
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Research & Development Centers
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Restaurants
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Retirement Communities/Nursing Homes
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Shopping Centers
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Tenant Improvements
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Theaters
maryland cost segregation cost studies maryland accounting firms performing cost studies maryland_accounting_and_tax_returns_cost_segregation Warehouses
*Assumes a 40% tax rate and 8% discount rate. Does not include additional savings that could result from the 30% or 50% bonus depreciation.
 
What is Needed for a Proposal and Tax Savings Estimate?
 
New Construction:
maryland cpa firm cost segregation studies maryland_accounting_and_tax_returns_cost_segregation Project Budget
maryland cpa firm cost segregation studies maryland_accounting_and_tax_returns_cost_segregation Final AIA Payment Application
maryland cpa firm cost segregation studies maryland_accounting_and_tax_returns_cost_segregation Indirect Costs
maryland cpa firm cost segregation studies maryland_accounting_and_tax_returns_cost_segregation Construction Contact Person
Purchased Property:
cpa firms maryland_accounting_and_tax_returns_cost_segregation Closing Statement
cpa firms maryland_accounting_and_tax_returns_cost_segregation Depreciation Schedules
cpa firms maryland_accounting_and_tax_returns_cost_segregation Site Survey Drawings
cpa firms maryland_accounting_and_tax_returns_cost_segregation Facility Contact Person
Simply segregating percentages of construction subcontracts or invoices can leave significant and valuable benefits on the table. Additionally, this method generally will not withstand an IRS audit.
You need a Maryland CPA firm with experience in cost segregation to assist you in classifying your property to save money, not only now, but in the future. We work in close affiliation with a professional group of construction engineers who have a thorough knowledge of the tax code and experience in successfully defending cost segregation studies before the IRS since 1981.
For more information on cost segregation studies, or to arrange an appointment to discuss your project, contact Jane Brewer or Kent Thomas at 410-828-CPAS or e-mail at jbrewer@kawgf.com or kthomas@kawgf.com.
 
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