| Tax tips and tax help to assist taxpayers by | | | | several ways when making charitable contributions. |
| describing options for tax reduction and tax cuts | | | | For example, you purchased land 10 years ago for |
| through lawful tax deductions. Tax deductions | | | | $200,000, and it is now worth $1,000,000. However, |
| contribute to national prosperity by providing capital to | | | | you now realize you will never use the land for the |
| business. Tax deductions reduce taxable income. A | | | | intended purpose. You can donate the land to a |
| $100,000 tax deduction reduces federal income tax by | | | | qualified charitable organization and take a tax |
| $35,000 ($100,000 X 35%) assuming a 35% income | | | | deduction for $1,000,000. However, you do not have to |
| rate. Options for increasing business tax deductions | | | | pay capital gains taxes on the appreciation. Tax |
| include revising depreciation schedules, reviewing fixed | | | | deductions sometimes seem arcane and complicated. |
| asset listings, casualty losses, bad debts, and charitable | | | | However, a knowledgeable team of advisors from |
| contributions. Real estate depreciation offers | | | | several fields can reduce your federal income taxes. |
| substantial opportunity for increasing tax deductions. | | | | The complexity of the tax code makes it difficult for |
| Most depreciation schedules are established by simply | | | | any one personal to be knowledgeable in all areas. |
| separating land and long-life improvements. This simple | | | | Cost segregation produces tax deductions and |
| approach is lawful but sharply understates lawful | | | | reduces federal income taxes across the country and |
| depreciation. About 20-40% of improvements for most | | | | in every size market. Below are just a few examples |
| properties are short-life items. Short life items can be | | | | of cities where cost segregation generates meaningful |
| depreciated over 5, 7, or 15 years. There are about | | | | tax deductions. City: |
| 130 short-life items that have been determined by | | | | - New York, NY |
| legislation, tax court decisions and IRS rulings. Real | | | | - Houston, TX |
| estate depreciation can typically be increased by | | | | - Hartford, CT |
| 50-100% for the first 5-7 years of ownership by | | | | - Las Vegas, NV |
| obtaining a cost segregation study. A cost segregation | | | | - Memphis, TN |
| study precisely values up to 130 components of real | | | | - Philadelphia, PA |
| estate that can be valued as short-life property. By | | | | - Orlando, FL |
| obtaining a cost segregation study, it is possible to | | | | - Phoenix, AZ |
| obtain a windfall of tax deductions by "catching-up" | | | | - Atlanta, GA |
| previously under-reported depreciation. This one-time | | | | - Bridgeport, CT |
| "catch-up" can occur in the first tax return filed after | | | | - Worcester, MA |
| the cost segregation study is performed without filing | | | | - Akron, OH |
| any amended tax returns. Reviewing fixed asset | | | | - Harrisburg, PA |
| listings (of business personal property) can generate a | | | | - Salt Lake City, UT |
| meaningful amount of tax deductions. They often | | | | - St. Louis, MO |
| include items that should have been expensed, which | | | | - Portland, OR |
| have been sold or thrown away or which have an | | | | - Scranton, PA |
| excessive depreciation life. Items that should have | | | | - Greenville, SC |
| been expensed include operating expenses | | | | - Bakersfield, CA |
| (sometimes included by error) and maintenance or | | | | - Madison, WI |
| repairs (which was necessary but did not increase the | | | | - Chicago, IL |
| life of the assets or component.) Section 179 allows | | | | - Fresno, CA |
| business to use up to $108,000 of 2006 capital | | | | - Riverside, CA |
| expenditures as tax deductions. Confirm you are not | | | | - Albany, NY |
| capitalizing assets that could be claimed as a tax | | | | - Indianapolis, IN |
| deduction. Casualty losses also offer opportunity for | | | | - Birmingham, AL |
| tax deductions. For a casualty loss, you can deduct: 1) | | | | - Ft. Lauderdale, FL |
| the market value immediately before the casualty less | | | | - Baton Rouge, LA |
| 2) the market value immediately after the casualty | | | | - Augusta, GA |
| less the amount covered by insurance. The portion | | | | - Honolulu, HI Cost segregation produces tax |
| that is not intuitive is: the market value after the | | | | deductions for virtually all property types, including the |
| casualty is much less than the value before? plus the | | | | following: Property Type: |
| cost to renovate. Other factors which can and should | | | | - Medical facility |
| be considered for tax deductions are: lost rent/usage, | | | | - Shopping mall |
| stigma (in some cases), construction management, | | | | - Restaurant |
| construction risks, and entrepreneurial effort. Bad debts | | | | - Country club |
| are a subjective matter. Judgment is required to | | | | - Fast food restaurant |
| accurately estimate the amount that should be claimed | | | | - Power center |
| as a tax deduction. If bad debts have not been | | | | - Hotel |
| examined carefully for several years, they may offer | | | | - Car wash facility |
| a meaningful tax deduction opportunity. (This applies to | | | | - Convenience store |
| companies who utilize accrual accounting. Companies | | | | - Health spa Almost every industry, including the |
| who use cash accounting can't claim a tax deduction | | | | following, can generate cost-efficient tax deductions |
| for bad debt since they never recognized the | | | | by using cost segregation. |
| revenue.) Do well by doing good. You reduce taxes in | | | | |