When acquiring, renovating or building real estate, most taxpayers tend to overstate the amount of 39-year real property. This limits the depreciation deductions available to taxpayers in the early stages of their investment. A cost segregation solves this problem by reclassifying assets by maximizing the property eligible for treatment as 5-, 7- or 15-year property. This depreciation optimization frees up substantial cash flow.
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Experience & Benefit
The Ernst & Morris brand, built on the same model of serving CPA firms, adds an impactful depth to the collective firm’s Cost Segregation practice and further cements the status of being the leading technical resource in the industry.
McGuire Sponsel’s expertise in the Research & Development Tax Credit, International Tax, and Credits & Incentives provides an exciting opportunity to deliver additional value to Ernst & Morris relationships while maintaining the exceptional service that their clients have grown accustomed to.
How McGuire Sponsel Can Help
McGuire Sponsel’s unique approach to cost segregation employs civil, structural and architectural engineering knowledge coupled with tax law experience to identify components that qualify for accelerated depreciation. Our team’s blend of engineering and tax code expertise provides tremendous value throughout a project. The professionals at McGuire Sponsel perform a site inspection for every study and all costs, along with their classifications, are then documented to withstand IRS scrutiny.
Over $3.1 B
IN REVIEWED ASSETS
Over $7.3 M
SAVINGS FOR EVERY $100 MILLION REVIEWED
See the Difference
When McGuire Sponsel clients see our alignment with competitors, it is rare for them to find another firm with the level of respect we have for the CPA/client relationship.LET'S TALK
What Makes a Great Prospect
Studies can be performed for current year transactions or on a retroactive basis. While every client is unique, we typically see a consistent benefit when the following criteria are met:
- Acquisition or New Build in excess of $750,000
- Interior renovation in excess of $200,000
- Companies with large fixed asset schedules
- Companies that renovate or make repairs frequently
If a property has been acquired, newly built, or renovated, please connect with our practice leaders.TALK TO A PRACTICE LEADER
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Commercial Office Portfolio
The professionals at McGuire Sponsel performed a cost segregation study on a $195 million portfolio of office buildings located in Arizona, Florida, Tennessee, Texas, and Washington D.C. Our specialists physically inspected the properties, tenant listings, and general ledgers to optimize depreciation and partially disposed assets. The result was a $9.4 million increase to the first year cash flow.
Leasehold Improvements & Depreciation
For the last few years the IRS has allowed for certain leasehold improvements to receive special treatment for depreciation. While rooftop or outdoor HVAC units are not eligible for this treatment, the IRS confirmed HVAC units located inside a building and feeding tenant areas are eligible for 15-year treatment and bonus depreciation. This confirms the position McGuire Sponsel has taken for our clients.