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Cost Segregation

Many commercial real estate owners and residential rental real estate owners can benefit tremendously from a project called a Cost Segregation Study.  This is the process during which a CPA works alongside an Engineer to identify individual components of your building in order to maximize your depreciation deductions.

Michels & Hanley performed 35 Cost Segregation Studies during the past few years.  Those studies saved our clients a total of $9,584,323.  That’s an average tax savings of $273,838 per client.  At an average fee of only $6,477, our clients enjoyed an ROI of 1,895%, making their Cost Segregation Study one of the best investments they ever made..

Some Success Stories

  • Our most successful study to date was on a large 268 unit apartment building that a client of ours built for $90 million. We performed a comprehensive study in which $6,047,852 of tax savings was created, which represented approximately 6.72% of their entire project cost.
  • A medical doctor owns the building he practices in.  We performed a study, during which we were able to create tax savings of $151,962
  • A manufacturing client purchased a building to move his business into and performed significant construction on the property before moving in.  We were able to create $1,489,540 of tax savings by performing a cost segregation study on this building.
  • One of our clients owns a condo that he rents out to a tenant.  We performed what seemed like a small study for his condo, but were able to uncover $56,965 of tax savings for him, locking in a 1,036% ROI.
  • Two clients of ours are cousins who each own their own separate business.  They share a building together that both of their businesses operate in.  We performed a study for them that generated a 2,101% ROI and $94,523 of tax savings. 
  • A young client of ours got married and moved out of state.  She owned a condo in NYC at the time and decided to rent it out instead of selling it.  We performed a cost segregation study for her and generated $43,402 of tax savings (1,736% ROI), which helped her and her family significantly with their move.

If you own a commercial building (even if it's owner-occupied), a multi-family residence, or a single family rental property, contact us now.  We can perform a preliminary Cost Segregation Study Estimate to give you an idea of your approximate tax savings and approximate fee.

  

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© Michels & Hanley CPAs, LLP 2021