The Practice of Cost Segregation Analysis Maximizing Tax Bennefits for Building Acquisitions and Construction

by Desrosiers, Bruce A.; Del Pico, Wayne J.

• ISBN13: 9780876297445
• ISBN10: 0876297440
• Edition: 1st
• Format: Hardcover
• Copyright: 2004-01-07
• Publisher: RSMeans

Summary

This expert guide walks you through the practice of cost segregation analysis, which enables property owners to defer taxes and benefit from "accelerated cost recovery" through depreciation deductions on assets that are properly identified and classified. A relatively new practice that evolved from various court decisions and Internal Revenue Service rulings, cost segregation can be applied to new buildings under construction, renovations of existing buildings, leasehold improvements, and purchased real estate - going back as far as 1987. Cost segregation practice requires knowledge of both tax law and the construction process. In this book, the authors share their expertise in these areas with tax and accounting professionals, cost segregation consultants, facility owners, architects and general contractors - providing guidance on major aspects of a professional, defensible cost segregation study, including: The legal framework for cost segregation, as defined by the IRS, tax courts, and federal agencies Review of key IRS cases, court rulings, and revenue procedures Classification and depreciation methods Understanding construction plans and specifications Professional takeoff and cost estimating procedures Optimizing cost segregation in new construction - from design choices to proper project documentation With a glossary of terms, sample cost segregation estimates for various building types, key information resources, and updates via a dedicated website, The Practice of Cost Segregation Analysis is a must-have resource.

Author Biography

Bruce A. Desrosiers CPA, MST and Wayne J. Del Pico are the authors of The Practice of Cost Segregation Analysis: Maximizing Tax Bennefits for Building Acquisitions and Construction, published by Wiley.

Table of Contents

About the Authors & Reviewers	ix
Foreword	xi
Part I: Tax Regulations & Precedent-Setting Rulings	1	(114)
Introduction to Cost Segregation	3	(6)
Income Taxes & Depreciation Deductions	9	(50)
The Legal Framework for Cost Segregation	59	(6)
Tax Cases, IRS Revenue Rulings, & Revenue Procedures	65	(16)
Classification of Property	81	(34)
Part II: The Engineering/Estimation Portion of Cost Segregation	115	(92)
Asset Allocation Methodologies	117	(6)
Plans & Specifications	123	(16)
Estimating Standards & Practices	139	(6)
Area & Volume Calculations for Takeoff	145	(8)
Understanding Material & Labor Cost Factors	153	(8)
Sources of Pricing Information	161	(8)
Cost Segregation in Design & Construction	169	(38)
Part III Appendix, Glossary, & Resources
Appendix A: Cost Segregation Audit Techniques Guide Excerpts	177	(8)
Appendix B: Cost Segregation Issues in the Restaurant Industry	185	(10)
Appendix C: Calculating the Surface Area of Cylinders, Pyramids, & Cones	195	(2)
Appendix D: Using RSMeans Cost Data	197	(10)
Glossary	207	(10)
Resources	217	(2)
Index	219