Mid Atlantic Real Estate Journal — Professional Services — November 23 - December 6, 2012 — C T ax S olutions
www.marejournal.com
By Bruce A. Johnson, CEM, Bedford Strategies & Solutions Year end tax planning for real estate owners
A
s 2012 comes to a close, many of the incentives available
lighting and HVAC systems? If so, you may be eligible for a tax deduction of up to
stances where these pro- grams were reinstated at the closing of the year, we
a qualified consulting firm, you will be able to take ad- vantage of some or perhaps
for amending tax returns. Looking forward to 2013, especially in the case of new construction, the integration of your tax professional and cost segregation consultant during the design and bid stage of a project will result in maximum benefits as- sociated with accelerated depreciation. Bruce A. Johnson is a partner at Bedford Strategies and Solutions, and helps provide innovative tax, finance, and energy solu- tions for commercial real estate owners. n
to property owners will exp i r e . I t is always a good i dea to look at the various s t rat eg i es a v a i l a b l e t h a t c a n minimize or
It is always a good idea to look at the various strategies available that can minimize or potentially eliminate federal tax liability for this year, and possibly years to come. A quick review of your overall tax depreciation treatment may very well reveal some last minute benefits.
Bruce A. Johnson
$1.80 per square foot. Currently both bonus de- preciation and qualified leasehold improvement leg- islation is set to expire on December 31, 2012. While there have been past in-
cannot count on these ben- efits being available in the future. All of the above oppor- tunities should be closely evaluated with your tax professional. In concert with
all of these valuable strate- gies. For those who may have “missed the boat” on some of these incentives, it is possible to conduct look-back studies for many of these strategies without the need
potentially eliminate federal tax liability for this year, and possibly years to come. A quick review of your overall tax depreciation treatment may very well reveal some last minute benefits. Fol- lowing is a quick summary of tax incentives and strate- gies available for owners of commercial and residential rental real estate. Bonus Depreciation If you have recently con- structed or renovated a prop- erty you may be eligible to take advantage of 50% bonus depreciation on certain as- sets. Qualified Leasehold Improvements If you have paid for lease- hold improvements, as a landlord or tenant, in a building that is at least three years old, there may be significant opportunity to receive 50% bonus deprecia- tion on a very large portion of those improvements. A cost segregation study prepared by a qualified, cre- dentialed individual is the best way to properly docu- ment eligible property for the above incentives. Write-down of Assets Taken Out of Service Recently released guid- ance from the IRS provides property owners the ability to write-down assets that are part of a renovation. Under certain conditions, this treatment can be ap- plied to activities that have happened in the past. Just imagine taking a write- down adjustment for some- thing you have thrown away! These regulations also pro- vide more clarity on how and when certain maintenance items can be expensed ver- sus being capitalized.
Energy Tax Deductions
Have you recently con- structed an energy efficient building or upgraded your
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