What are the different cost segregation methodologies the IRS allows?

What are the different cost segregation methodologies the IRS allows?

Here is a list of the six most common cost segregation methodologies


For this discussion, we will address the last in this list…the “Rule of Thumb” Approach. According to the IRS Audit Techniques Guide for Cost Segregation, “…the “Rule of Thumb” approach uses little or no documentation and is based on a preparer’s “experience” in a particular industry. For example, a preparer will estimate IRC Sec. 1245 property as a fixed percentage of project cost by relying on previously determined “industry averages” (e.g., 40% for a manufacturing facility). An IRS examiner should view this approach with caution since it lacks sufficient documentation to support its allocation of project costs.”  Continue reading>>>

Views: 22

Comment

You need to be a member of COMMERCIAL REAL ESTATE PROFESSIONALS & INVESTORS GROUP to add comments!

Join COMMERCIAL REAL ESTATE PROFESSIONALS & INVESTORS GROUP

"Early Adopter Upside with 90% Downside Protection" Sale is now live with up to 6X bonuses

FOLLOW US

© 2021   Created by Jude G Regev.   Powered by

Badges  |  Report an Issue  |  Terms of Service