Tax Savings Strategies | TaxConnections

Access Leading Tax Experts And Technology
In Our Global Digital Marketplace

3 Cost Segregation Trigger Events In Real Estate Life Cycle

While cost segregation is useful throughout the real estate life cycle, there are certain events that tee up particularly strong cost seg opportunities. These events should automatically trigger consideration of a cost segregation study, since picking the right moment can maximize benefit. Read on for our top 3 cost segregation study triggers – so you can proactively recognize opportunity.

1. New Construction of Commercial Property

Cost segregation takes advantage of the time value of money by front-loading depreciation to the early years of ownership. As such, to maximize savings from Year 1, a cost seg study should ideally be performed as soon as a newly constructed property is placed-in-service.

Consider a newly constructed hotel placed-in-service in 2021 (100% bonus in play.) Capstan was retained to perform a study immediately after construction was completed.

Written by Bruce Johnson | Posted in Cost Segregation Studies • Tax Savings Opportunities

As a business owner, you know first-hand that taxes can take a big chunk out of your pocket. No matter how small your business is or how large you grow, you’ll always be on the hook for some kind of taxes. However, the tax code is such that there is always room for strategic tax savings as long as you operate within the laws. Your CPA is the best source of tax-saving strategies, but it can help if you present some of your own ideas, too. Here are some that are worth considering.

1. Consider Hiring Independent Contractors Instead of Employees

Payroll taxes are something every business owner needs to consider before making a commitment to add another employee to the payroll. Payroll taxes are one of the larger taxes that business have to pay, and they come around not once, but usually at least twice a month. One way that businesses have gotten around paying payroll tax is buy hiring independent contractors instead of employees. You don’t have to pay payroll tax on independent contractors that you hire. Of course, there are certain rules about what constitutes an IC and what constitutes an employee, but once you ensure you would be in compliance, you may be able to get by with ICs.

Written by Kazim Qasim | Posted in Tax Savings Strategies