The Twelve Days of Taxmas – Cost Segregation Studies
As Christmas approaches, Klatzkin is putting a twist on a holiday classic. But rather than filling your head with drummers drumming and golden rings, we’re focused on providing important tax insights through “The Twelve Days of Taxmas” blog series that could help minimize your tax liability.
On the seventh day of Taxmas, my accountant gave to me a Cost Segregation Study.
A cost segregation study allows a business with substantial improvements or construction of a building to review all costs of that building and separate assets that have shorter lives than the building itself. This allows for more depreciation to be recognized earlier on in the building’s useful life and even potentially wholly written off in the first year. The strategy helps with cash flow when cash flow has recently taken a hit with improvement or construction costs.
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©2020 Klatzkin & Company LLP. The above represents our best understanding and interpretation of the material covered as of this post’s date and should not be construed as accounting, tax, or financial advice. Please consult your tax advisor concerning your specific situation.