“You gotta keep ‘em separated” -The Offspring
Depreciation…we usually think of cars and how the value they lose when it’s driven off the lot. Do you think of depreciation regarding your business? Depreciation helps lower the amount of earnings on which taxes are based- which is great! The more depreciable expenses you have, the lower your taxable income and tax bill will be.
If your business owns commercial real estate, the building structure is depreciated over many years (27.5 to 39) while the smaller items are classified in shorter depreciable lives (5, 7, and 15 years). So…. you could potentially speed up some big depreciation expenses with a Cost Segregation. A Cost Seg lets you take some immediate deductions yielding significant tax savings.
Cost Segs are so not in my wheelhouse….but I know someone who does them! Recently, I met with Chris Bailey with Moody & O’Neal, CPAs here in Mt. Pleasant. Chris and his team have extensive experience identifying these opportunities. If you think you may benefit from a Cost Seg you should definitely reach out to them!
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