It’s no surprise our clients are focused on other things besides the next deal. The aggressive desire for new deals has been replaced with laser focus on the core business economics of their existing holdings.
Below are a few of the benefits our clients like about Cost Segregation:
- Increased Cash Flow — By correctly reclassifying the life of an asset to a shorter period, the accelerated depreciation expense reduces taxable income and the resulting related tax and therefore increasing the projects cash flow.
- Retroactivity — You can claim immediate savings on any property that has been purchased or constructed in the last 10 years, with the filing of your current return. No need for an amended return.
- Return on Investment that’s off the charts — The return on the investment in a Cost Segregation Study is usually more than 100% in the first year. For new projects, the return is even higher over the next 4 years.
- Defensible — As with any item or position you take on a tax return, you must have clear and proper documentation. A Cost Segregation Study provided by an experienced and qualified firm will provide the support in the event of IRS questions.
Several years ago no one cared about taking advantage of every opportunity to increase cash flow. The proformas looked better and better every year. Rents would continue to rise. Cap rates would continue to compress.
Today is different. Investors are looking every way possible to extract the greatest value and increase cash flow for their existing properties.
