Kevin Jerry

Alternative Valuation Method for Inherited Property

An Alternative Valuation Method is Available for Inherited Property Once the amount of any gain or loss is determined, the taxpayer must decide whether or not it is long-term or short-term. The capital gain or loss is long-term if the investment property is held for more than one year. The capital gain or loss is …

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The End of Many Miscellaneous Deductions

Beginning in 2018, many miscellaneous deductions have been suspended. Beginning in 2018, many miscellaneous deductions have been suspended. These suspended deductions will impact your taxable income if you are a building owner or investor. However, many of our clients have told us that the Tangible Property Regulations have reduced taxes enough to offset these eliminated …

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Building for Routine Maintenance Safe Harbor

Routine Maintenance Safe Harbor

The Routine Maintenance Safe Harbor is one of the most overlooked safe harbors within the mandatory Tangible Property Regulations under §263a (1-3). If you are cost-segregating a property, you can assume your cost segregation firm has never heard of the Routine Maintenance Safe Harbor. The reason is the majority of cost segregation firms, especially the …

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Small Taxpayer Safe Harbor

The Tangible Property Regulations include a Safe Harbor for small taxpayers. This safe harbor is an excellent opportunity for (among others) single-family residential rentals, apartment complexes, and student housing. This Safe Harbor, within the Tangible Property Regulations (under §263a), allows all expenditures under the lesser of $10,000 or two percent (2%) of the unadjusted basis …

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inherited property

Inherited Property. Long-Term Capital Gain or Short-Term?

When investment property is inherited, the capital gain or loss on any later disposition of that property is treated as a long-term capital gain or loss. The gain or loss on a sale or trade of property is found by comparing the amount realized with the asset’s adjusted basis. The basis of property that is …

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Building Demolition

Demolishing Your Building? You Need to Read This.  Now.

When investors and building owners purchase a building that may need to be totally gutted soon, they are disheartened to learn that they will lose all future depreciation deductions related to the building. This Regulation is under §280B. §280B states that if a building is being demolished and more than 25 percent of the walls …

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cost segregation sales person

Why You Need to Ask Your Cost Segregation Salesperson These Questions

Cost segregation is not only engineering-based but also TAX based. Therefore, your salesperson must have advanced knowledge of the tax implications of a cost segregation study. Cost segregation is not only engineering-based but also TAX based. Therefore, your salesperson must have advanced knowledge of the tax implications of a cost segregation study. Formerly, I was …

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Building receiving cost segregation study

Why You CANNOT do A Cost Segregation Study Without Utilizing the Tangible Property Regulations

If your cost segregation firm does not FULLY understand the MANDATORY Tangible Property Regulations, you are missing substantial opportunities to reduce your taxes. Moreover, you could be out of compliance with the U.S. Tax Code. Even the large cost segregation firms, who brag about how many studies they have done, ignore the mandatory Tangible Property …

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How Most Cost Segregation Firms are Costing You Money

If your cost segregation firm does not understand U.S. Tax Code, you are probably losing significant opportunities to reduce your taxes. After being in the industry for over seven years and having worked for a large cost segregation firm, I am dismayed at the lack of tax knowledge that so many engineering-based firms possess (or, …

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Creating a Hybrid Revenue Recognition Model for the Construction Industry

A Hybrid Revenue Recognition Model to Increase Cash Flow Construction industry members — including owners, developers, contractors, subcontractors, and supply chain vendors — have experienced varying degrees of hardship due to the COVID-19 pandemic, supply chain challenges, cost increases, and “the Great Resignation.” The extent of the consequences is dependent upon the location of both …

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