Schedule a free cost segregation consultation to find out if a study could help your company save on taxes for the present and past tax periods. CorporateTaxAdvisors offers Cost Segregation Services.

In today's competitive business environment, it is more important than ever to find ways to reduce costs and increase profits. One tax-saving strategy that many businesses are overlooking is cost segregation.

Cost segregation is a process that allows businesses to reclassify certain building components as personal property. This can result in significant tax savings, as personal property is depreciated over a shorter period of time than real property.

Benefits of Cost Segregation

There are a number of benefits to cost segregation, including:

Increased tax savings: As mentioned above, cost segregation can result in significant tax savings.
Improved cash flow: By accelerating depreciation, cost segregation can improve cash flow.
Reduced audit risk: Cost segregation studies are conducted by experts who are familiar with the IRS's regulations. This can help to reduce the risk of an audit.
Increased profitability: By reducing costs and improving cash flow, cost segregation can help to increase profitability.
How Cost Segregation Works

Cost segregation studies are conducted by experts who analyze building costs and classify them into different categories. These categories include:

Building shell: This includes the walls, roof, and foundation of the building.
Building systems: This includes the heating, ventilation, and air conditioning (HVAC) system, plumbing system, and electrical system.
Furniture and fixtures: This includes office furniture, fixtures, and equipment.
Land improvements: This includes landscaping, parking lots, and sidewalks.
Once the building costs have been classified, the experts will determine the potential tax benefits of cost segregation.

Cost of Cost Segregation

The cost of a cost segregation study will vary depending on the size and complexity of the building. However, the cost is often offset by the tax savings generated.

Case Studies

Here are a few case studies of successful cost segregation projects:

A manufacturing company was able to reduce its tax liability by $1.2 million by conducting a cost segregation study.
A retail company was able to improve its cash flow by $500,000 by conducting a cost segregation study.
A healthcare company was able to increase its profitability by $250,000 by conducting a cost segregation study.
Conclusion

Cost segregation is a valuable tax-saving strategy that can benefit businesses of all sizes. If you are looking for ways to reduce your tax liability and improve your profitability, cost segregation may be right for you.