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DGS 119: The Ins and Outs of Cost Segregation
Description
What is cost segregation, and how does it work? If you're knowledgeable of the tax code and understand what you're able to do, you will put money in your pocket.
Today, I am talking to Kim Lochridge, Executive Vice-President at Engineered Tax Services. The company started with about six employees and has grown to 130 to do 150-200 cost segregation studies a month. Kim loves talking about taxes. She's here to help make sense of it all!
You'll Learn...[03:10] Investment Depreciation Concept: What you get when you have an investment property. It's a tax deduction.
[05:15] Depreciation is everything and anything, including buildings, carpet, walls, paint, countertops, and cabinets that depreciate over 27.5 years (unrealistic).
[07:17] Cost Segregation Metamorphosis: IRS allows building professional/engineer that understands property and tax laws to segment each component of a building.
[10:30] Does Kim use cost segregation? No matter how big or small, she doesn't do a deal without cost seg.
[11:53] Cost Segregation Studies: How long are you going to own the property? What are you going to be doing with the property?
[12:03] Justify Numbers: Don't do a cost seg study unless it makes sense financially to pay less in taxes for more money to reinvest.
[15:10] Audit Defense: Engineered Tax Services covers questions from IRS about cost seg performed by internal engineers.
[16:00] Tax Strategy: Know how to use it and when to use it. Too many people don't understand taxes and let their professionals handle it.
[16:21] Motto: We do believe that everyone should pay tax, but there's nothing in the code that says you have to leave a tip.
[16:55] When and when not to do cost seg? Ask questions. If something doesn't make sense, make it make sense.
[21:35] Bonus Depreciation: Too good to be true? Or, leaving money on the table by not doing cost seg? Probaby 80-90% of real estate agents are missing out.
[29:30] Depreciating Bonus Depreciation: Do it now before it decreases from 100% to 20% in 2026.
TweetablesEngineered Tax Services's Motto: Everyone should pay tax, but there's nothing in the code that says you have to leave a tip.
Depreciation: What you get when you have an investment property. It's a tax deduction.
Don't do a deal without cost seg. It doesn't matter how big or how small.
Bonus Depreciation: It's a big deal, not a scam, to spark the economy.
ResourcesDoorGrow Cold Leads Calculator
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