Summary
In this episode, Brandon Bruckman interviews Erik Oliver from Cost Segregation Authority to explore the intricacies of cost segregation and its benefits for real estate investors. They discuss how cost segregation allows for accelerated depreciation, the reasons why CPAs may not handle these studies, and the importance of identifying suitable properties for cost segregation. The conversation also covers the flexibility of timing for these studies, the implications of current tax laws, and the impact of the CARES Act on energy efficiency credits. Eric emphasizes the need for collaboration between investors and their CPAs to maximize tax savings.
Takeaways
Cost segregation allows for accelerated depreciation on real estate investments.
Many CPAs lack the construction knowledge needed for cost segregation.
Properties with a depreciable basis over $250,000 are good candidates for cost segregation.
Cost segregation can create significant tax savings in the first year of ownership.
Timing is flexible; cost segregation can be done years after purchasing a property.
Depreciation recapture can be managed effectively with cost segregation.
Current tax laws, including bonus depreciation, greatly benefit real estate investors.
The CARES Act introduced energy efficiency credits for residential and commercial properties.
Collaboration with CPAs is crucial for maximizing tax benefits.
Cost segregation studies can be a valuable resource for real estate investors.
Chapters
00:00 Introduction to Cost Segregation
02:47 Understanding Cost Segregation
06:02 Why CPAs Don't Handle Cost Segregation
08:52 Identifying Good Candidates for Cost Segregation
12:12 Timing and Flexibility of Cost Segregation
14:49 Depreciation Recapture and Tax Implications
18:12 Impact of Current Tax Laws on Cost Segregation
20:59 CARES Act and Energy Efficiency Credits
34:01 Working with Cost Segregation Experts