If you own commercial real estate and have paid Federal Income Taxes in the past three years, we GUARANTEE we will get you a significant tax credit or refund!
A Cost Segregation Study is a strategic, tax-saving tool that can be used by companies and individuals who have constructed, purchased, expanded, or remodeled any kind of commercial real estate. The study allows the owner to take advantage of accelerated depreciation deductions and defer federal and state income taxes.
Normally, 100% of the cost of commercial real estate is depreciated over 39 years. During a Cost Segregation Study, components of a property or leasehold improvement that can be depreciated over a shorter time (5, 7, or 15 years) are identified and reclassified. For example, 30% to 90% of the total electrical costs in most buildings can qualify for 5 or 7-year depreciation.
Typical components that can be reclassified include a building’s non-structural elements, such as carpet, decorative lighting and trim, dedicated electrical and plumbing, and security systems; exterior land improvements, such as landscaping, curbs, sidewalks, fencing, and signage; and indirect construction costs, such as architect and engineering fees and construction permits. The result of a Cost Segregation Study is that a property owner’s tax obligation is reduced and cash flow is increased. flow is increased.
Cost Segregation is not new; on the contrary, it has been in existence since 1954 when the IRS allowed for certain personal assets to be accelerated into a shorter life class. However, it wasn’t until Hospital Corporation of America sued the IRS in 1997, and won, that the IRS revisited the issue of accelerated depreciation. The IRS ruled that property qualifying as tangible personal property under the former Investment Tax Credit (ITC) rules would also qualify for purposes of federal income tax depreciation under MACRS (Modified Accelerated Cost Recovery System).
The IRS Chief Attorney wrote a memo stating “…Cost Segregation, for it to be properly applied, had to involve those with competencies in architecture, engineering or construction and/or construction techniques, in order for personal property assets to be accurately identified and segregated.” As a result of this memo, Cost Segregation became a viable tax-saving strategy allowed by the IRS.
Commercial real estate property eligible for Cost Segregation includes buildings that have been purchased, constructed, expanded, or remodeled since 1987. A study is typically cost-effective for buildings purchased or remodeled at a cost greater than $100,000. A Cost Segregation Study is most efficient for new buildings under construction, but it can also uncover retroactive tax deductions for much older buildings. Other commercial property, such as rental houses and tenant improvements are also eligible.
The present or future value of the money you can save by having a Cost Segregation Study is usually quite substantial. Additionally, you have access to the cash now so you can reinvest it! A Cost Segregation Study in effect gives you an interest free loan from the government for the first 15 years, which you will then repay interest free over the remaining 25 years. Wouldn’t you rather have your money? There are also advantages to doing a study if the building is going to be sold or if the owner of the building dies.
Your CPA can assist you in receiving a free analysis. From the information you supply, we can provide you a conservative estimate of the accelerated benefits you can expect as well as the fee proposed for the final study.
Typically, tax savings from 5% to 10% of the building’s original tax-basis is realized, but there are instances where it can be substantially more.
Certain types of commercial property can be grouped together to give us an idea of the percentage of those types of buildings that have been eligible for accelerated depreciation. Your results may be greater, or they may be less than those shown below, but in general, property that falls into one of the following categories is most likely to result in accelerated depreciation within the specified ranges.
Yes! Cost Segregation can provide additional tax benefits. It can reveal opportunities to reduce real estate tax liabilities and identify certain sales and use tax savings opportunities. Under certain circumstances, segregated assets may qualify for a special bonus depreciation allowed by multiple tax reconciliation acts enacted by Congress. Additionally, a Cost Segregation Study can:
These testimonials are not “cherry-picked” – they are typical of all our testimonials. After more than 10,000 clients, Segregation Holding has never had a dissatisfied customer because we’ve never failed to save a client money!
“I can tell you this, if you don’t do anything else regarding your property, do this.” Gabe Anderson, Anderson Properties LLC read more
“This study was well worth the effort, and I recommend the services of Jeff Hobbs and Segregation Holding LLC to anyone in the dental industry.” Dr. David Taylor, DDS, MS, A Perfect Smile Orthodontics read more
James C. Shindler received an initial estimate of $100,000 in tax savings. After the Cost Segregation Study was completed, he had this to say, “After providing very simple information… your team completed their work and provided me with approximately four time the estimated savings.” James C. Shindler, Owner, Chicken Express read more
After getting nowhere with his CPA several years ago, Frank Christensen’s recommendation is, “…that if you have commercial property, hire this organization to do a Cost Segregation Study for you. If you ask your CPA about this and they advise you not to do this, get a new CPA. The cost benefit of this is… read more
“Looking back on it, I would gladly pay double what I did to get such a tremendous return.” Sami Arnouk, Arnouk Properties read more
“I have been so pleased with Mr. Hobbs and the service he provides that I have referred him to my sister (who is a dentist) and my closest friends (dentists, orthodontists, etc.),” Dr. William Nguyen, DMD, Arte Dental read more
“I am writing to thank you for your diligent work and efforts in completing the cost segregation study for Mrs. Dixon’s B&B Ranch. Her lack of documents and help made me want to give up on her many times, but you persevered . . . the results produced more than double your original estimate. I… read more
“This was a great business decision for me.” Jackson Moore, Anchor Investments read more
“My one regret is that I did not get this study done at the planning stage, before building.” Dr. Corbett, Corbett Dentistry read more
“I did not understand why my tax preparer could not accelerate depreciation on my tax return without this study. Due to Mr. Hobbs willingness to educate me on the IRS guidelines. . . I decided to hire Mr. Hobbs to do the cost segregation study on my office.” Dr. Chris Villanueva, Dental Family Circle read more
“The segregation study was completed in just a few short weeks. This was probably the easiest part of the entire construction build, and the only part of the construction build that actually did something to put money back in my pocket.” David Weaver, D.M.D, Dream Dental read more
“I highly recommend you and your company to anyone wanting to maximize their tax savings and at the same time be treated with such respect and kindness.” Phillip Duran, D.D.S, Duran Dental Center read more
“In the beginning of our relationship I was somewhat skeptical as to how you could price your work in such a way as to make it feasible for some of my clients who own small leasehold space. I know it works for those who own assets in access of $500,000 but I have many dentists… read more
“He [Jeff Hobbs] was very professional and understanding in how he worked with us. There didn’t seem to be any question to elementary for him to answer as we worked through the decision to engage his services.” Frank Centimole, Owner, Extra Space Storage read more
“I was very pleased with the survey Jeff Hobbs did. They were done in 8 weeks and worked seamlessly with my CPA.” Dr. Fred Haight, Haight Family Dentistry read more
“The process was very smooth and painless on our end. We simply provided Segregation Holdings with all the construction and closing documentation for the building and Jeff Hobbs took it from there.” Kristal Heath, Office Manager, NRH Pediatric Dentistry read more
“I have to admit, I was a little skeptical initially because I wasn’t so familiar with this type of study. Little did I know I’d be saving so much money!” David Mansour, DMD, Lewis & Mansour read more
“Wow! I am so glad I listened to Mr. Hobbs and my CPA and had the cost segregation study done!” Donna Davis Mixon, Proprietor, MD Resort read more
“One of my offices had a 1965% return on their fee. Using them [SHL] to correct your depreciation schedules to get money back from the IRS is a no-brainer..” Dr. Mike Kesner, Pain Consultants of East Tennessee read more
“Segregation Holding LLC exceeded their initial benchmark estimate. We are please to recommend them without reservation.” Joe H. Browder, MD, Pain Consultants of East Tennessee read more
“Mr. Hobbs was able to reallocate 5 and 15 year properties in excess of what he had originally projected.” Steve Hopland, CEO, Pine Palms Management read more
“We are pleased with the results. Without reservation, I recommend Mr. Hobbs and Segregation Holding LLC if you want to reduce your federal income taxes.” Paul Lankford, CFO, Queens Plaza Holdings, LP read more
“Had we known we could get the taxes we paid the IRS for the last 3 years back we’d have done this sooner! ” Mark Savage, Managing Member, Savage Investments, LLC read more
“Both in the beginning and after the study was completed you answered all of our questions and made the process much easier to go through.” Billy Franko, CFO, Sam & Louie’s Pizzeria read more
“The hardest part for me in the beginning was to write him a check. The easiest thing for me to do at the end was to write him a check.” Dr. Chadwick L. Williams, Smiles By Chad read more
“It is my pleasure to recommend Jeff Hobbs and his team at SHL. Jeff was dependable, straightforward, honest and very professional. He explained the process and what they could deliver with their services. And they didn’t just deliver in my case; they exceeded their initial estimate by almost 50%!!!.” Fernan Rodriguez, DDS, MS, Orthodontic Specialist,… read more
“When you came back to present the final report and showed that we were actually due over $270,000 for 2013 I was speechless! Your process was so simple. lt’s really hard to believe that all we had to do was give you our drawings and some invoices and you were able to get us a… read more
“The process was easy and painless, and the result of his study was even more than what he initially calculated. Definitely a winner!” Angelie V. Zamora, DDS, Smiles of Las Colinas read more
“I am thrilled to say [I] am getting reimbursed more than 50% of their anticipated refund!” Theresa H. Knott, DDS, Town Center Dental Clinic read more
“Wanted to take the time to thank you . . . Even though we are in a remote location, you took the time to come out personally and evaluate the office to thoroughly conduct the cost segregation study” Jamie B. Epperson, DDS, Twelve Oaks Dental Clinic read more
“As a Wendy’s franchisee we are privy to a constant barrage of information that is supposed to save us money. My experience has been that most times this isn’t the case. However, in this instance, I was pleasantly surprised.” James A. England, Managing Member Owner read more
*Typical refund or credit of $80,000 based upon a commercial property with a tax basis of $2 million and a 37% tax bracket. You results will vary. Guarantee based upon engagement, excludes individual rental properties with a tax basis of less than $200,000. See our engagement for complete details.
