Alternative Minimum Tax Consequences Are Not a Result of Cost Segregation

Posted by Patrick Oconnor
1
Dec 15, 2014
699 Views
Alternative Minimum Tax consequences are not a result of cost segregation. Nor is cost segregation accelerated depreciation. Decisions regarding cost segregation and accelerated depreciation are independent by the four options as illustrated in the following matrix: 



Cost Segregation Straight Line Depreciation




No Cost Segregation Straight Line Depreciation




Cost Segregation Accelerated Depreciation




No Cost Segregation Accelerated Depreciation



Accelerated depreciation increases the amount of depreciation taken in early years of ownership but triggers alternative minimum tax consequences. The alternative minimum tax consequences are severe enough that many investors avoid accelerated depreciation. 

A cost segregation study delivers the benefits of more depreciation sooner without the unfavorable alternative minimum tax repercussions. There are no alternative minimum tax consequences resulting for using cost segregation. Cost segregation with straight-line depreciation increases depreciation by 50% to 100% during the early years of ownership without triggering alternative minimum tax penalties. 

Click here for a FREE preliminary analysis of tax savings resulting from your property. 

Cost segregation produces tax deductions and reduces federal income taxes across the country and in every size market. Below are just a few examples of where cost segregation generates meaningful tax deductions. 

City:
  • New York, NY
  • Houston, TX
  • Washington, DC
  • San Francisco, CA
  • Memphis, TN
  • Dallas/Ft. Worth, TX
  • Denver, CO
  • Phoenix, AZ
  • Orlando, FL
  • Philadelphia, PA
  • Cincinnati, OH
  • Madison, WI
  • McAllen, TX
  • Chicago, IL
  • Tulsa, OK
  • Austin, TX
  • Dayton, OH
  • Honolulu, HI
  • Stockton, CA
  • Boise, ID
  • Charlotte, NC
  • Durham, NC
  • San Jose, CA
  • Nashville, TN
  • Baton Rouge, LA
  • Buffalo, NY
  • Birmingham, AL
  • Indianapolis, IN
  • Manchester, NH
  • Oxnard, CA
Cost segregation produces tax deductions for virtually all property types. 

Property Type:
  • Truck terminal
  • Airplane hangar
  • Retail
  • Apartments
  • Convenience store
  • Single-tenant retail
  • Movie theatre
  • Health spa
  • Self-storage
  • Bowling alley
Almost every industry, including the following, can generate cost-efficient tax deductions by using cost segregation. 

Industry:
  • Textile product mills
  • Electronic and appliance stores
  • Truck transportation
  • Arts, Entertainment, and Recreation
  • Day care facilities
  • Furniture stores
  • Building supply dealers
  • Plastic and rubber products manufacturing
  • Chemical manufacturing
  • Computer and electronic manufacturing
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