Tax Warrior Chronicles

Seize the Day: There’s Never Been a Better Time to Consider Cost Segregation

Posted on Wed, Jun 17, 2020

Everyone wants to maximize tax savings on their commercial real estate, and while Cost Segregation Studies have long been a solid IRS-approved strategy, these days they are more popular than ever, especially with some of the changes under the CARES Act,Today’s guest blogger, Terri S. Johnson of Capstan Tax Strategies, is here to explain why “cost seg” studies are all the rage, and to walk us through the top-three prime cost segregation scenarios.    

 

Simply put, Cost Segregation is an engineering-based analysis in which specific property components are identified and reallocated into modified cost recovery system (MACRS) class lives.  Treating the components as personal property or land

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IRS Hones in on Partial Asset Disposition Deductions

Posted on Fri, Jan 17, 2020

By: Ashley Menders

 

On November 6, 2019, the IRS released a process unit to train and educate its agents on partial asset dispositions of a building. The release of this educational material to its employees may indicate IRS intent to target these deductions for examination, which are common in the real estate industry. Before we address this development, we'll first give you a refresher and explain the information your tax preparer needs to determine if you may benefit from the deduction. Finally, we'll address risk mitigation, given the recent IRS pronouncement.

 

What is a Partial Asset Disposition?

As part of the Tangible Property Regulations (TPR) released in 2013 that overhauled how

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Relief from the Tangible Property Regulations… Should You Take the Bait?

Posted on Tue, Mar 03, 2015

The IRS recently issued Revenue Procedure 2015-20 providing relief for many small businesses from the administrative burdens required to adopt the new tangible property regulations effective for 2014.  The tangible property regulations, which are more commonly known as the “repair regulations,” provide new rules for determining which costs should be capitalized and which should be expensed, and essentially require you to forget everything you once knew on the topic.  Old standards like “useful life beyond a year” have been scrapped and replaced with new terms of art: to be capitalized as an improvement, an expenditure must now rise to the level of a “betterment, adaptation, or

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