Join Daniel Nickles with his guest Erik Oliver as we discuss how cost segregation frees up your liquidity and improve cash flow as a real estate investor. As the cost segregation expert that he is, Erik gives us a detailed overview of what cost segregation could mean for anyone investing in real estate. In his own simple terms, cost segregation is basically just your property’s appreciation on high speed. Erik explains what cost segregation means, what bonus depreciation is in relation to cost segregation, and the basics of cost segregation for newly closed deals.
In this episode you will learn:
- Cost segregation increases the benefits you get by owning real estate
- Bonus depreciation is cost segregation on steroids
- You don’t have to do cost segregation right after buying a property
- The documents necessary for cost segregation
- What questions to ask a cost segregation expert
About Erik Oliver:
Erik Oliver is the marketing director of Cost Segregation Authority.
Cost Segregation is used by commercial building owners to increase cash flow by accelerating depreciation. Depending on the type of building, there can be anywhere from 20 to 35% and sometimes more of the depreciable basis that can accelerated, translating into tens of thousands if not hundreds of thousands of dollars in current year tax savings. Consider the value of having and being able to use those tax dollars today vs. spreading them out over 27.5 or 39 years.
Cost Segregation can be used at pretty much anytime during the cycle of building ownership, including new construction, current acquisitions, previous acquisitions going back as much as ten or fifteen years, large improvement projects, following a step in basis from a change of ownership or estate transfer, and sometimes even at disposition to offset some of a capital gain.
Cost Segregation is an engineering-based analysis of a building’s interior, exterior and land improvements in order to identify, measure and quantify assets that are considered personal property or land improvements under the federal tax code. Those assets are then re-classifying in order to accelerate their depreciation.
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