What is Cost Segregation?
Cost segregation is a conservative, IRS-defined approach for depreciating commercial properties thereby reducing your federal incomes taxes. Income taxes are a burden; don’t pay more than is required.
Cost segregation BOTH reduces and defers state and federal income taxes. It reduces income taxes by converting ordinary income to capital gains. It defers income taxes by increasing depreciation in the early years of ownership.
Does Your Property Qualify?
- Real property acquired or built after 1986
- Commercial for profit venture
- Depreciable basis of at least $500,000
Can Be Performed For
- Most commercial properties
- Any “for profit” commercial asset
- Significant Renovations
Your Potential Savings
CPA’s and Tax Professionals
None of the roughly 5,000 cost segregation reports we prepared have been changed in an IRS exam.
Cost segregation does not increase audit risk. In virtually every cost segregation assignment, our advisors and appraisers interact with the client’s CPA, accountant or tax advisor…
Here’s How OUR Process Works.
First we seek to understand the client’s needs and magnitude of tax pain and review properties available for cost segregation.
O’Connor & Associates works closely with you and/or your CPA or financial/tax manager to collect existing data and documents regarding the subject property.
An appraiser inspects the property to identify eligible items, then calculates their value and allocates each to its correct depreciation life, per IRS rules and Federal Tax Courts decisions.
Tax Savings Delivered For Our Clients
$
Serving All 50 States with Cost
Segregation Solutions
Why O’Connor Cost Segregation?
We are cost segregation specialists! Our studies are IRS tested, CPA approved, and warrantied for the duration of your ownership of the asset studied! Satisfaction is guaranteed; if you are not satisfied, you do not pay.
Our studies are a key component in keeping you IRS compliant! O’Connor cost segregation studies not only detail all short-life components, but also provide a breakout of all Units of Property (UoP) as required in the recent IRS Tangible Property Regulations.
We can help you on assets you have owned for years! “Catch-Up” (C-U) studies allow you to claim previously under-reported depreciation from prior years without filing any amended tax returns!
IRS Approved and Compliant! Cost Segregation is a conservative, defendable, IRS-defined depreciation approach that will reduce your federal income taxes! Our warranty of the study is included in our flat fee study. Should IRS questions arise, we will defend our studies at no additional charge to you!
Accountant Friendly. We partner with your CPA or Tax Professional! Our advisors and appraisers interact with your accountant throughout the entire study process.
O’Connor is experienced and Professional! Our technical experts are state-licensed appraisers who have performed cost segregation studies on thousands of commercial assets nationwide.
Property Types That Benefit From Cost
Segregation Studies.
Apartment Building Cost Segregation
Hotels, Motels, Hospitality
Office Buildings
Medical / Dental Buildings
Shopping Centers
Retail
Assisted Living / Nursing Homes
Manufacturing
Warehouse / Distribution
Self Storage
Restaurants
Auto Dealerships / Service Centers
Bank / Financial
Private School / Day Care
REITs
Green Buildings
O’Connor has meant SAVINGS for business! We can do the same for yours. Click here now to estimate your savings
A few words from some of our trusted
Clients across America.
We instruct O’Connor & Associates to perform a cost segregation study as part of our standard operating procedures. The study is an integral part of our strategic tax planning process and has proven efficient, effective and valuable in reducing federal taxes to the appropriate level, therefore optimizing our overall strategy.
CEO, Commercial Property Management and Investment Firm – Texas
We have worked with O’Connor and Associates for over 5 years. Their cost segregation experts have always provided great client service when performing cost segregation studies. They also provide excellent reports which can be used as support documentation for depreciation schedules and IRS audits. Their studies have saved my clients thousands in tax dollars!
CPA, CGMA, Shareholder – Major CPA Firm – East Coast
This is the second year we have used O’Connor to deliver cost segregation services. My clients are sophisticated and very demanding large multi-unit residential owners with properties in several states. The O’Connor team of relationship manager, cost segregation manager and CPA confidently addressed all our needs throughout the process. They have become one of our key real estate advisors.
CPA with Major CPA Firm – West Coast
As their CPA firm, clients expect us to seek out and utilize tools which will minimize their federal taxes. Cost segregation is an appropriate, conservative and cost effective tool to substantially reduce federal and state income taxes. Our clients have been extremely please with the results.
CPA, Atlanta-based Consulting Firm
Highlighted Projects
Multifamily Assets
SAMPLE OF ACTUAL STUDY RESULTS
Depreciable Basis
$44,040,000
$10,880,500
$2,265,000
$26,090,000
$14,875,000
Purchase Date
MAY 2017
NOV 2016
JUN 2016
DEC 2016
OCT 2016
Year of Study
2017
2016
2016
2016
2016
1st Year Additional Depreciation
$1,529,116
$103,096
$67,498
$287,496
$124,986
1st Year Tax Savings
$605,530
$40,826
$26,729
$113,849
$49,495
Year 1 Payback
191.0:1
15.1:1
9.3:1
41.9:1
20.2:1
Initial 5 Years Tax Savings
$2,500,721
$655,596
$115,424
$1,681,319
$889,755
5 Year Payback
790.0:1
244.0:1
41.2:1
620.0:1
365.0:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.
Hotels/Motels
SAMPLE OF ACTUAL STUDY RESULTS
Depreciable Basis
$5,305,794
$3,309,000
$8,292,875
$5,476,716
$1,541,605
Purchase Date
MAR 2010
JAN 2013
MAY 2014
DEC 2015
MAY 2015
Year of Study
2015
2015
2015
2015
2016
1st Year Additional Depreciation
$514,853
$451,748
$1,186,211
$100,339
$331,716
1st Year Tax Savings
$203,882
$178,892
$469,739
$39,734
$131,360
Year 1 Payback
75.0:1
59.2:1
156.6:1
9.1:1
128.9:1
Initial 5 Years Tax Savings
$216,657
$244,791
$829,856*
$653,681
$239,115*
5 Year Payback
80.7:1
82.1:1
276.6:1
151.0:1
222.4:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.
Office Buildings
SAMPLE OF ACTUAL STUDY RESULTS
Depreciable Basis
$883,800
$3,570,000
$36,000,000
$3,989,720
$8,110,020
Purchase Date
FEB 2016
JUN 2016
DEC 2015
MAR 2017
DEC 2016
Year of Study
2016
2016
2015
2017
2016
1st Year Additional Depreciation
$24,703
$115,440
$1,255,926
$101,060
$74,237
1st Year Tax Savings
$9,782
$45,714
$497,347
$40,020
$29,398
Year 1 Payback
3.3:1
15.3:1
170.0:1
13.4:1
8.7:1
Initial 5 Years Tax Savings
$49,639
$203,580
$1,982,620
$198,806
$463,945
5 Year Payback
17.6:1
69.1:1
679.0:1
67.5:1
138.0:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.
Retail Centers
SAMPLE OF ACTUAL STUDY RESULTS
Depreciable Basis
$6,020,000
$2,294,500
$8,659,978
$15,507,407
$1,444,320
Purchase Date
AUG 2015
JUN 2016
APR 2017
MAY 2016
SEP 2015
Year of Study
2015
2016
2017
2016
2015
1st Year Additional Depreciation
$114,110
$76,280
$282,371
$306,395
$56,683
1st Year Tax Savings
$45,187
$30,207
$111,819
$121,332
$22,447
Year 1 Payback
46.8:1
10.9:1
37.0:1
38.3:1
8.3:1
Initial 5 Years Tax Savings
$192,751
$142,879
$536,329
$636,629
$100,215
5 Year Payback
200.0:1
52.4:1
179.0:1
202.0:1
37.9:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.
Self-Storage Facilities
SAMPLE OF ACTUAL STUDY RESULTS
Depreciable Basis
$572,352
$3,989,720
$1,624,000
$3,115,580
$4,485,602
Purchase Date
AUG 2015
MAR 2017
SEP 2016
S'Sep 2016
DEC 2016
Year of Study
2015
2017
2016
2016
2016
1st Year Additional Depreciation
$192,731
$101,060
$31,955
$96,704
$23,986
1st Year Tax Savings
$76,322
$40,020
$12,654
$38,295
$9,498
Year 1 Payback
30.1:1
13.4:1
4.3:1
11.7:1
3.3:1
Initial 5 Years Tax Savings
$87,787
$198,806
$68,288
$182,485
$171,187
5 Year Payback
35.8:1
67.5:1
20.8:1
56.9:1
60.7:1
* Results from “Catch Up” studies which allow the owner of properties purchased in previous
tax years to benefit from cost segregation in the current tax year without filing amended returns.NOTE: The above listed tax savings are based on a 39.6% tax rate for the owner.