A detailed, high-quality engineering analysis will provide the documentation that’s essential for accelerating depreciation. It’s important to remember that a cost segregation study isn’t generating “new” deductions. Rather, it’s speeding up your ability to claim deductions. In many cases, a cost segregation study can help you accelerate the recovery period for 20% to 40% (or more) of your depreciable cost basis.
Businesses routinely write off adjusted basis when they retire fixed assets. Yet, many neglect to apply that same strategy to what is often their most significant fixed asset: their real estate. In many cases, the reason is that they simply lack the cost details that are required to properly leverage this tax strategy.