By Paul Martin, CPA, MBA | Senior Manager – Tax Paul Martin Head shot

Have you or are you looking to purchase, construct, expand, or remodel real estate? If so, a Cost Segregation Study may be a great tool to help reduce income tax and increase cash flow.

What is a Cost Segregation Study

A cost segregation study enables individuals and companies to accelerate depreciation deductions on real estate owned or being constructed. By doing this, taxes are deferred to future years and increase current cash flow. The additional cash flow can be used to pay down debt, purchase equipment, or whatever else you want to use it for – it is extra cash flow!

Cost Segregation Study Process

The process of having a cost segregation study completed is relatively straightforward; however, it is important to have an experienced professional perform the study. A review of all of the costs of the property must be performed, an inspection of the property must be completed and documented, and all costs must be allocated for tax purposes to provide the maximum tax benefit.  At the end of the study, a formal report will be issued that meets and exceeds IRS standards.

If you think you, or your company, could benefit from a cost segregation study, please contact me at 216.674.3748 or pmartin@applegrowth.com.