Recently, the regulations for commercial property owners were overhauled in one of the most dramatic changes to the tax law in years. The Tangible Property Regulations in conjunction with the Tax Cuts and Jobs Act have major economic benefits for building owners as well as some serious compliance issues.
Properly applying these new U.S. tax code standards can help you capture economic opportunities to the tune of millions in tax savings that flow from your business to your personal taxes.
I would be happy to work with you and your tax professional to make sure you are taking the greatest advantage of these new tax laws. CSSI, a company that I represent, can be your calculation experts for the following
- COST SEGREGATION – The U.S. tax cost method of identifying and classifying building components that allow you to accelerate depreciation and generate additional cash flow. An engineering-based cost segregation study is the basis for allowing you to capture many of the tax saving opportunities below and it helps you maintain U.S. tax code compliance moving forward with these regulations.
- BUILDING SYSTEMS VALUATION – An engineering-based study that will identify building systems and structural components. Going forward every expenditure cannot be expensed. The new regulations give very specific instructions on whether expenditures should be capitalized as an “improvement” or expensed as a repair. We will provide the calculations that your tax professional will need to make these important decisions.
- CAPITAL TO EXPENSE “REVERSAL” OPPORTUNITY – Building owners may now expense previously capitalized costs and expense them in the current year by applying the new regulations to prior years. For example, we helped a client receive $1.1 Million in tax savings on one of his properties through this method.
- PARTIAL ASSET DISPOSITION (PAD) – Renovate in the current tax year? Thinking of an LED lighting upgrade? A PAD allows you to write down the basis of what you removed and the costs for the removal and disposal of those items. You can receive a tax deduction in the current year but it is a “use it or lose it” opportunity. Fail to capture it in the current tax year and you lose the ability to write it down. Both capital to expense reversals and PADs yield a permanent tax savings at the time of the sale by reducing recapture costs.
Let me provide you and your tax professional a no-cost, no-bligation analysis of the benefits you may receive and the cost for this type of study for your property.
Return the following information, and I will prepare your analysis immediately.
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