Cost Seg Building

A Blog About Tax Savings for Building Owners

Author: John Murphy (Page 16 of 16)

Husband of 34 years to my college sweetheart, Janet Murphy (@janetmurphydesign on Instagram). Together we have 6 wonderful children from ages 15-31 and 5 grandchildren. I've been a licensed REALTOR since 2003 and broker since 2007. I also am a cost segregation specialist helping building owners and real estate investors maximize their tax deductions, save thousands on their income taxes and increase their cash flow. If you're a building owner you probably haven't done a study...let's connect. There is no obligation. We can run an estimate for you and really every building should be evaluated if the basis is over $150,000. I can work all over the country and not just here in the Upstate. We relocated to Greenville, SC for the lifestyle, lower cost of living, amazing amenities in the area and the growth opportunity for business and real estate. We absolutely love it here!

All opinions are expressly my own and do not represent either eXp Realty LLC, Cost Segregation Services, Inc. or any other company, organization or group that I might be affiliated with.

California Eliminates Parking Lot Minimums for New Develpments

January 16, 2023 /
Photo Credit – John Murphy, Cost Seg Building

There is a movement afoot in the U.S. for some cities and now even states eliminating parking lot minimums when it comes to new development or redevelopment projects. California has now officially banned parking minimums.

Given the high cost of development and land, this makes sense to allow the developers to put more toward the building itself rather than allocate additional space for parking to meet an arbitary requirement by a city or county council. That said, America hasn’t given up cars yet and people still need parking. It will be interesting to see how this evolves over time.

I can imagine that some developments will scale back too much and word will get out that those developments are hard to get in and out of and may deter customers from showing up. I guess we’ll see how this goes. My guess is we won’t have a good read on this for at least 10 years.

Top Multi-Family Developers in the U.S. in 2022

January 10, 2023 /
Photo: Greystar | 85 Boston St., Everett, MA | Boston Real Estate Times

Mulit-Housing News is out with their annual list of the top development firms building multi-family housing across the U.S. in 2022. There were some massive numbers put up by the top firms in 2022.

Top 10 firms are:

  • Greystar
  • The Related Cos.
  • Trammell Crow Co. / High Street Residential
  • LMC, a Lennar Co.
  • The NRP Group
  • Mill Creek Residential
  • Crescent Communities
  • The Bainbridge Cos.
  • ZOM Living
  • JPI

Despite the constant state of negative business news in general, multi-family continues to plough ahead with consistent development. From Mulit-Housing News, “Despite rising construction costs in recent years, multifamily development has maintained a strong pace. A recent supply update from Yardi Matrix predicts deliveries will exceed 420,000 units by the end of the year and expects multifamily completions to hit north of 430,000 in 2023 and more than 450,000 in 2024.”

There has been lots of doom and gloom about real estate ever since the Fed started to raise interest rates. And it may well be warranted. I suspect these deep pocked firms will be just fine and will weather whatever choppy market we face in the coming year or two.

Cost Segregation for Starbucks Retail Buildings

January 9, 2023 /
Starbucks buildings are great to study for cost segregation. The 5 year class life is better than most retail buildings. If it's a newer developed building, often times the 15 year class life (land developments) are also significant leading to great tax savings for the owners of these commercial buildings.

Cost segregation is a terrific strategy for any commercial building owner. New retail development tends to do quite well we are finding especially in part because of the land improvements to develop the property. New retail buildings for Starbucks for example are excellent for cost segregation.

With a new Starbucks not only do you tend to see great numbers from the 15 year class life category but also in the 5 year as well as the stores tend to be finished nicely.

If you’re interested in getting a no-obligation free estimate on your building, please don’t hesitate to reach out at 864-276-1448. I work all over the U.S.

NAI Columbia Merges with NAI Earle Furman – South Carolina Commercial Real Estate

January 6, 2023 /
Photo: NAI Earle Furman’s Home Page

Two sizable commercial real estate firms have officially merged together. According to the Columbia Business Report, the two companies have been working toward this for four years. NAI Earle Furman and NAI Columbia have joined forces.

“We are excited that NAI Columbia is officially rolling into our business family,” Jon Good, CEO of NAI Earle Furman said in a news release. “This collaboration will mutually benefit both of our firms with more manpower, added support and additional resources. Together we will be able to better serve our clients throughout South Carolina and beyond.”

This sure seems to make a lot of sense especially in the world of commercial real estate where there are some very big players with large networks who serve the Upstate and Midlands area.

Donald Trump’s Tax Returns – Cost Segregation On Full Display

January 2, 2023 /
Image Source: www.DonaldJTrumpc.om

Last week Congress released Donald Trump’s tax returns in hopes to find something that they can either shame him with or perhaps file criminal charges. But remember, Trump was and is a real estate developer and owner before becoming President of the United States. I remember hearing people clammoring to see his taxes but my thoughts were it’s likely we’ll see little to nothing because he probably maximizes his real estate depreciation to minimize or eliminate his tax liability. It turns out that clearly is one of the strategies he utlizes. The best ways to maximize depreciation on your buildings is by doing cost segregation.

According to the article in BisNow, Trump used a number of different strategies including loss carryforwards to eliminate his tax liability. Don’t think this can be used by the small to midsized investor? Think again. These kinds of strategies are available to all U.S. taxpayers. You just have to have a tax professional who can help you think strategically about these things as well as have a trusted source for cost segregation.

If you own an investment property or commercial building that has a depreciable basis of at least $200,000 and you have not done cost segregation yet on your building, please reach out and I will be happy to discuss this with you. We’ll run a no obligation estimate that will show you what we expect to achieve with increased accumulated depreciation and what it will cost. You can then discuss it with your tax professional and decide yea or nea. It’s that easy. We’ll collect a few documents from you as well as send someone out to photograph your property and then we’ll get started on the study. It’s pretty painless to you as the owner. It takes us six weeks to complete our engineering-based cost segregation study.

Building Owners – Did You Do a Signifant Renovation in 2022?

December 12, 2022 /

Just a reminder for building owners and their tax professionals out there…we are the outsourced provider for hundreds of tax professionals and firms who need to get cost segregation done for their clients. We can help with partial asset dispositions on large ($100k+) renovations as well as capitalization to expense reversals. If you have clients who have buildings and if they haven’t done a cost seg study, reach out and let’s talk. We can usually make it work for a client down to about $200,000 in depreciable building cost / basis. We are still 5-6 weeks away from our deadlines to hit tax deadlines of 3/15 and 4/18/23…that time will go fast. Let’s get them scheduled.

Commercial Brokers, Realtors and Insurance Brokers Should Use Cost Segregation to Grow their Business

November 29, 2022 /

My experience is that 8 out of 10 building owners aren’t aware of this incredible tax application that boosts their cash flow and lowers their taxes… commercial brokers, insurance brokers, tax and financial profressionals and property managers are all trying to reach buildling owners and yet few if any are having conversations about cost segregation. You don’t need to be an expert. Just ask if they’ve done it yet to their building. It’s a missed opportunity all the way around.

If you don’t ask, you’re missing out on potentially really helping a client. In some cases you might gain a new client because of it. Maybe you end up writing another policy or pick up more money to invest from them. Or maybe with the extra money they save they end up buying another building with you…or you pick up a new tax client. Plus you can get paid a referral if you join our referral program. It’s easy and costs you nothing. Contact me to join our program and let’s keep business and building owners in business and profitable! Note: financial services cannot be paid a referral due to regulations. However, let’s say you help someone save $50-$100k on their taxes…perhaps they will reinvest some of that tax savings with you buying financial / life insurance products.

Tenant Improvements – Should They Be Capitalized or Expensed?

November 29, 2022 /
Photo: John Murphy, Cost Seg Building

Dumpsters will often catch my attention 🙂 I wonder how many building owners who are paying for TI’s / Upfits in a building like this capitalize the improvements rather than expensing them? I don’t know anything in particular about this specific building. I don’t know what the upfit costs will be but it was stripped to the studs. Let’s say it’s $50-$75k to renovate this space? Would you capitalize it? Expense it? Let’s assume the owner has had this building in-service for at least one tax year. Since this is one of 4 units in this building, we would think expensing those improvements utlizing the Tangible Property Regulations would be the way to go.

If you happen to have a building where you think you may have capitalize improvements / TIs where perhaps they could have been expensed, feel free to reach out. We can help you figure that out at no cost. If it turns out you can and should do a capitalization to expense reversal you might be able to do it on your own…if you need our help, I would get you an estimate. BTW, these typically are absolutely monster tax savings or the owner 🙂

TI #TIs #tenantimprovements #upfit #interiorbuildout #commercialproperty #commercialbuilding #retail #retailstrip #stripcenter #taxes #taxsavings #TPRs #tangiblepropertyregulations #repairregs #capitaltoexpensereversal

Kansas City Based NorthPoint Development Plans Massive Industrial Park in Spartanburg, SC

November 29, 2022 /
Photo: NorthPoint Development / Upstate Business Journal

Money continues to flow into the Upstate of South Carolina as more companies and developers realize the value of having facilities here.

NorthPoint Development recently purchased 310 acres and plans to build a large industrial park in Spartanburg County called Spartan Enterprise Park.

More information about their development can be found in the Upstate Business Journal article. The developer is quoted, “NorthPoint Development is excited about the opportunity to bring our expertise to one of the fastest growing industrial markets in the country,” said NorthPoint Development Director of Industrial Leasing Nathan Brinker. “We have identified the Upstate as a prime market for investment due to its central location in the Southeast offering access to a large percentage of the population, connectivity to major regional transportation corridors and efficient delivery of goods via the state’s expanding inland and seaport network. Our assessments of this market show a rapidly growing population and corresponding favorable labor dynamics which companies look to when making expansion or relocation decisions. We look forward to working with local and regional economic development entities as well as the Colliers team to find the right tenants and bring new corporate investment to the Upstate.”

Dentists Can Save $100,000 On Taxes By Using Cost Segregation

November 8, 2022 /
Photo Credit: John Murphy

Dental buildings have really come a long way. We are seeing more and more of them with beautiful design and finishing. Many now cost between $1.5 – $2.0 million. That’s a big expense for anyone and especially for dentists who may well be continuing to pay for dental school loans.

If the ownership of the operating business and the LLC that owns the dental building are the same, the dentist can group these entities the first year they put the building into service. That allows the operating LLC to take advantage of the depreciation generated by the real estate LLC. The tax savings can be significant.

Many of these buildings will see 20-30% of the building cost or basis able to be depreciated in the first year. For buildings placed into service starting in 2023, the bonus depreciation drops from 100% to 80% so please note that.

Recently we saved this dentist well over $100,000 on their income taxes when we did an engineering-based cost segregation study for them.

Newer posts »

© 2025 Cost Seg Building

Theme by Anders Noren — Up ↑