GAME OF DRONES

the suit staff
TAX SAVINGS
REALIZED
by Capturing Benefits of
Detailed Engineering Analysis
Building owners have a new
opportunity to take advantage
of tax savings in 2014 based
on repairs under new guidelines
recently issued by the Internal Revenue
Service. It’s a move that Greg
Bryant says his firm, Beford Cost
Segregation based in Bedford, New
Hampshire, is prepared to make on
behalf of its clients. The new IRS
regulations cover the deduction and
capitalization of expenses due to acquisition,
renovation, improvement
or disposition of real estate.
“It provides a significant opportunity
to address the needs of those
repairs that restore a building to its
regular efficient operating condition,”
explained Bryant, managing
partner of Bedford.
While the new regulations regarding
repair tax savings become permanent
in 2014, building owners can
reach back to the 2012 and 2013 tax
years for benefits based on repairs
completed in those years. Repairs
can include the testing, inspection
and routine maintenance necessary
to keep a property in operating condition.
It takes a fair portion of expertise
combining tax benefits with construction
engineering analysis to
meet the complicated requirements
laid out by the IRS. That’s where
Bedford enters the picture with its
proprietary ReCap study aimed at
identifying capitalized items and
possibly reclassifying them as repairs.
This can result in a significant
tax deduction in the taxpayer’s favor.
Cost segregation is another tool
Bedford uses to find tax savings for
its clients in the early years of owning
a property. IRS rules mandate
that commercial properties be depreciated
over a period of 39 years
and residential rental properties
over a period of 27.5 years. This recovery
period can be shortened with
the support of a detailed engineering
analysis called a cost segregation
study, Bryant explained. It basically
is a front-loading of depreciation
giving building owners greater tax
deductions in the early years of
building ownership.
On the surface, it sounds simple.
Yet, as Bryant states, it simply isn’t.
“It is always a challenge to look at
a 100-page document submitted by
the IRS and boil it down to plain English,”
Bryant said. “Then to be able
to explain the concept to a client and
incorporate a strategy that is going
to make sense for our clients. We are
always vigilant to try to stay ahead
of the curve and to try to interpret
how these rulings coming down
from the Service can be used to impact
our clients in a positive way.”
Bryant said his firm continues to
accomplish this task for clients because
he has surrounded himself
with a team of highly-skilled experts.
“I am probably the least educated
person in our entire company,” he
said with a bit of a chuckle. “I would
say the identification of extremely
talented people has been my greatest
success in the industry.”
www.bedfordteam.com
THE SUIT MAGAZINE - DEC / JAN 2014