Unpacking the IRS Cost Segregation Audit Techniques Guide
Mark Lumpkin Mark Lumpkin

Unpacking the IRS Cost Segregation Audit Techniques Guide

Cost segregation studies are complex undertakings that require a breadth of expertise and experience. The IRS Audit Techniques Guide outlines the complexities of cost segregation studies, and also lists the 13 elements that define a “quality study.”

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Cost Segregation on Residential Real Estate
Jonathan Verret Jonathan Verret

Cost Segregation on Residential Real Estate

Anyone who owns an apartment, a duplex, or a single-family rental home is already claiming depreciation on residential real estate. But taxpayers that are still using the “default” 27.5-year, straight-line method of depreciation are missing out on a tax-saving opportunity.

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Depreciation Methods: Straight Line and Declining Balance
Jonathan Verret Jonathan Verret

Depreciation Methods: Straight Line and Declining Balance

The simplest method of depreciation is the straight line depreciation method, which simply deducts the cost of an asset evenly over the course of its recovery period. However, other methods of depreciation such as the declining balance method result in larger expenses in the early years of an asset's life.

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Tax Savings Comparison: Regular Taxpayer vs. Real Estate Professional
Jonathan Verret Jonathan Verret

Tax Savings Comparison: Regular Taxpayer vs. Real Estate Professional

Cost segregation can still be appealing for taxpayers who do not qualify as real estate professionals. Depreciation from a rental property can be used to offset that property’s rental income. If depreciation expenses exceed income, then the expenses are carried forward into the next tax year.

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Use it Or Lose It: Clock Ticking on CARES Act Carryback
Jonathan Verret Jonathan Verret

Use it Or Lose It: Clock Ticking on CARES Act Carryback

If your business shows a loss in tax year 2018, 2019, or 2020, then you can use that loss to offset your income from as far back as 2013. But how can you take advantage of this provision of the tax law if you aren’t showing an NOL this year?

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