Cost segregation identifies building components that are eligible for accelerated depreciation. Most buildings are depreciated for tax purposes over 39 years. By identifying, calculating and classifying costs to shorter tax lives of 5, 7 or 15 years, at accelerated rates, owners are able to increase tax deductions in the early years, when cash flows are most critical.
Asset Retirement and Tangible Property Regulation Compliance
Since 2006, Congress has worked to design and finalize regulations regarding whether certain expenditures related to tangible property should be capitalized or expensed. In 2013, these regulations were finalized. In addition, final regulations on the treatment of removed asset components were released in 2014, providing opportunities for new substantial tax write-offs. All taxpayers with tangible property must comply with these regulations beginning January 1, 2014.