Cost Segregation Is A Process That Allows You To Unlock Massive Tax Savings: Discover the Secret to Keeping More of Your Hard-Earned Money!
Do you feel you’re paying too many taxes for your investment property, or you own a business with real estate as part of it?
If you have purchased property worth at least $450,000 or have had $500,000 in improvements and plan to hold on to the property for 3+ years, you can capture thousands in tax benefits.
Surprised?
I was, too. Then, I started using it to save hundreds of thousands of dollars annually.
My name is Paul Spies, and I am a real estate investor and builder. I have been advocating a tax savings strategy for close to 6 years. It all starts and ends with depreciation. As an owner of a construction company and a real estate investor, I found that even after maximizing depreciation, I was still left with a sizable tax bill each year.
About 5 years ago, an investor friend introduced me to a tax-saving practice that has had a profound impact. It has allowed me to reinvest my current tax liability, aka keep more of my money, and invest in bigger and better projects. The secret lies in Cost Segregation Studies.
My name is Paul Spies, and I am a real estate investor and builder. I have been advocating a tax savings strategy for close to 6 years. It all starts and ends with depreciation. As an owner of a construction company and a real estate investor, I found that even after maximizing depreciation, I was still left with a sizable tax bill each year.
About 5 years ago, an investor friend introduced me to a tax-saving practice that has had a profound impact. It has allowed me to reinvest my current tax liability, aka keep more of my money, and invest in bigger and better projects. The secret lies in Cost Segregation Studies.
Paying a lot in taxes means you make good money, but you need to use your assets how you should. The piece of the puzzle you’ve been missing is using depreciation. Put simply, depreciation reduces your taxable income. Traditional depreciation methods spread out deductions over long periods, leaving you paying more upfront than necessary.
This outdated approach means you’re essentially giving the IRS an interest-free loan. What I learned 6 years ago is that I could find things in and on my property that help me reduce my taxable income. And when my taxable income goes down, I pay less taxes.
Here’s where cost segregation comes into play. Think of it as an X-ray for your property. The study takes an accounting of every item in + on your property (doors, windows, fencing, roof, etc.) and breaks down the “useful life” of each item. Another word for “useful life” is depreciation.
Using the cost segregation study to identify what items have shorter useful lives, real estate investors can pull forward depreciation that would otherwise take decades to claim.
And because depreciation reduces taxable income, the investor saves money on taxes, freeing up money to reinvest and build wealth.
It all comes down to the concept of depreciation and how to use it to your advantage.
Depreciation is a yearly tax deduction that lets you spread out the cost of certain property over the time you use it.
It’s like how a car loses value as it gets older.
Let’s say you purchase a fancy car worth a lot, but each year, it becomes a little less valuable because it gets worn out, has more miles on it, or newer models come out.
What is the car? It’s actually seats, an engine, brakes, tires, a frame, etc. These parts of the car have certain useful lives to them before they are expected to be worth $0. When all the parts are worth $0, the car is worth $0.
The same happens with residential and commercial investment property. Everything in and on the property has a useful life with its assigned useful life.
As the property is used, you’ll need to replace the roof, re-paint it, replace gutters, windows, doors, flooring…
Depreciation helps you account for this loss in value over time Cost segregation finds the useful life amounts of everything that makes up your property.
With this knowledge, a cost segregation study uncovers hidden savings and significantly reduces your tax liability. This savings is hidden in plain sight for you to take advantage of.
At Seneca Cost Segregation, we specialize in creating comprehensive cost segregation studies tailored to your property (or properties) and business needs. Our expert team conducts a meticulous analysis, identifying and reclassifying all eligible assets to maximize your tax savings.
You might think such a service would be prohibitively expensive or complicated, and while doing the analysis is complicated, we’ve streamlined it to be straightforward and cost-effective.
Our clients typically see a return on investment of 10-25:1. This means for every dollar spent with us, we return $10-$25 back into your pocket.
Your CPA mainly deals in compliance. Seneca deals in savings and guiding customers to unlock more from their properties, assets, businesses, and partnerships.
This is why 70% of customers who take the free tax assessment end up engaging past the cost segregation to unlock more savings and protections.
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