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When it comes to investing in multifamily properties, investors generally want to take every reasonable measure to increase their returns. One of the most effective ways to do this is to reduce their income tax liability via cost segregation, which massively speeds up the rate at which investors can claim tax deductions. Generally, multifamily real estate has an IRS depreciation period of 27.5 years, while other commercial real estate has a depreciation period of 39 years. However, cost segregation allows investors to take their deductions over 5, 7, or 15-year periods, greatly increasing their cash flow. We can abandon/dispose of renovated assets also without amending the return.
In addition, our niche engineering tax 45L ($2000 p/unit), or 179D ($1.80 p/SF) can further reduce your taxes and are separate from the cost segregation study.
Even if a property owner does not hold the property over 10 years, there are tax laws that can help owners if they sell in under 10 years.
TYPICAL APARTMENT COMPLEX COST SEGREGATION EXAMPLE