Here’s how depreciation and cost segregation work for property owners.
Today I want to talk to you about two of the most important benefits of investing in real estate: cost segregation and depreciation.
Depreciation is an extremely important part of real estate investing; basically means that real estate investors have 27.5 years for the IRS to depreciate their property. Once it’s on the market for lease, it starts depreciating in a straight-line depreciation for the next 27.5 years. This is going to save you a lot on taxes and is very important.
Cost segregation is the process of identifying personal property assets that are grouped with real property assets and separating out personal assets for tax reporting purposes. New tax laws allow you to segregate a lot more of the property inside and you could get huge tax savings almost immediately depending on your situation.
I recommend connecting with a licensed CPA if you have further questions.
I’m not a CPA, so I recommend that you talk to one if you want more in-depth information on these topics. If you need to connect with a good CPA to talk about depreciation or cost segregation, I’d be happy to connect you with one. Both of these things could save you so much money on your real estate investment properties.
If you have any other questions for me about property management, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.