I was going through some recent sales and saw that EnerSys Gigafactory LLC just closed on 321 acres in the Upstate. I found this press release and I’m sure there are several other news storage out there regarding this. The press release says between the state and Greenville County, they got $200MM in incentives to come build here. They plan on a state of the art 500,000 square foot facility that will bring about 500 jobs. Here’s another article about the proposed factory.
South Carolina appears to be a key destination for many of these giant batter facilities as we’ve seen with other deals. The South Carolina Department of Commerce are excellent business deal makers and there are lots of excellent economic development groups in South Carolina that also help.
Looking for cost segregation services here in the Upstate of South Carolina? I’m happy to help. While I work all over the U.S. and can work in all 50 states, I happen to live right here in Greenville, SC.
I represent CSSI, LLC and we offer several services to help building owners and tax firms:
cost segregation studies – engineering-based
partial asset disposition studies
179D tax deduction – energy savings
Research & Development Credits
3115s – we can draft as well as sign off on these forms when needed
CSSI, LLC has been in business for more than 20 years and we have completed about 50,000 engineering-based cost segregation studies saving our building owner clients a massive amount of money on their income taxes.
Do you own property on beautiful Lake Keowee in the Upstate of South Carolina? Is it a short-term rental? Long-term rental? Either way, you might benefit by doing cost segregation for tax savings.
I’m based here in the Upstate of South Carolina and work with many owners not only in South Carolina, but across the U.S. to study their investment properties for tax savings that can be the result of applying cost segregation to your properties.
Cost segregation is a tax planning strategy that can be applied to various types of real estate investments, including short-term rental properties. Short-term rentals, such as vacation homes or Airbnb properties, can benefit from cost segregation studies in order to maximize tax deductions and reduce taxable income. Here’s how cost segregation can be applied to short-term rentals:
What is Cost Segregation? Cost segregation is the process of identifying and classifying certain components of a real estate property into shorter depreciation periods for tax purposes. This allows property owners to accelerate their depreciation deductions, which in turn can reduce their taxable income and improve cash flow.
Types of Property Components: Cost segregation typically focuses on reclassifying certain building components from a standard 27.5 or 39-year depreciation period to shorter periods, such as 5, 7, or 15 years. Short-term rental property owners can benefit by reclassifying assets like:
Personal property: Furniture, appliances, fixtures, and equipment.
Land improvements: Landscaping, outdoor lighting, parking lots, and sidewalks.
Tenant improvements: Renovations or improvements made to cater to guests’ needs.
Benefits of Cost Segregation for Short-Term Rentals:
Increased depreciation deductions: By reclassifying assets to shorter depreciation periods, property owners can deduct a larger portion of the property’s cost in the early years, reducing their taxable income.
Improved cash flow: Higher depreciation deductions mean lower taxes, leading to increased cash flow for the property owner.
Enhanced ROI: The upfront tax benefits can significantly improve the return on investment for short-term rental properties.
Cost recovery: Cost segregation can uncover previously overlooked deductions, allowing property owners to amend past tax returns and claim retroactive deductions.
Cost Segregation Study: To implement cost segregation for a short-term rental property, property owners typically hire a qualified cost segregation specialist or firm. The specialist will conduct a thorough study, which involves inspecting the property, identifying eligible components, and preparing a detailed report that outlines the reclassified assets and their respective depreciation periods.
IRS Compliance: It’s important to ensure that the cost segregation study is performed in compliance with IRS regulations and guidelines. The IRS provides detailed guidance on cost segregation in its Cost Segregation Audit Techniques Guide.
Documentation: Proper documentation is critical when applying cost segregation to short-term rental properties. Property owners should maintain records related to the cost segregation study, including the study report and any supporting documentation.
While cost segregation can provide significant tax benefits for short-term rental property owners, it’s important to work with tax professionals or specialists who are experienced in this area, as it can be complex and requires expertise to maximize its benefits while staying compliant with tax regulations.
The Upstate of South Carolina continues to be a top area in the U.S. for site selection for companies not only in the U.S. but around the world. Greenville, Mauldin, Anderson and Spartanburg continue to be at the top of the list for many companies. It’s a great area to live and do business and the location in between Charlotte (1.5 hours) and Atlanta ( about 2.5 hours) away make it a great location especially for transportation. On top of that, it’s a beautiful area. Check out what the Upstate SC Alliance had to say on LinkedIn.
This is a new networking event that is spreading mostly throughout the South at this point. It’s geared toward those who work in and around commercial real estate, construction and development. If you provide services to any of the aspect of commercial real estate, this really is an enjoyable networking experience.
The organizers have made it by invite only and the cost to attend is $50 plus the roughly 10% clip that Eventbrite takes. They do provide drinks and appetizers and when I went to my first event in January in Greenville, the people who attended were quite friendly and open to conversation.
The Upstate of South Carolina continues to attract investment from all across the country and more and more people come to realize that the cost of living as well as land and building costs are less here than in most places across the country. The proximity to Charlotte, NC as well as Atlanta, GA are a big help. I-85 runs through Greenville and provides great transportation access to the south as well as cities further up on the east coast. The Inland Port Greer is also a massive business driver helping companies with their supply chains as it has direct access to the Port of Charleston.
“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.
John Murphy – Cost Segregation – Spartanburg Office Building
It’s always a good day when I can deliver our engineering-based cost segregation study to a building owner to helpl him/her save money on their taxes. Remember, what we do is reclassify a building from 39 year straight line depreciation in to 5, 15 and 39 year class lives. This allows the owner to take a bigger depreciation expense earlier in the life of his/her ownership of the building. That translates in to paying lower income taxes…and in some cases, it eliminates your income tax liability for a while.
This was a gorgeous older building in Spartanburg. It goes by the name Warrior Duck. It’s a 3 floor office building. As you can see by the image above, we saved this owner nearly $90,000 in income taxes.
As with all of my articles, I am not given tax advise. Everyone’s tax situation is different and each building performs differently. Please consult with your own tax counsel when considering cost segregation.
