Five Things to Know About Cost Segregation

(and Its Financial Impact for Your Facilities)


The important takeaway of reclassification is that you can separate and accelerate those items for depreciation on a much shorter schedule, providing immediate tax savings and increased cash flow.

5 Things Worth Consideration:

  1. 1 Separating out personal assets for federal tax purposes can result in substantial cost-savings with direct bearing on total cost of ownership
  2. 2 Land/facility improvements, certain building equipment, finishes, task lighting, portions of the electrical package, and elements not structurally affixed or connected to building operations warrant re-evaluation

Circled items indicate those qualified for accelerated depreciation. Most know that the crane, itself, can be separated from the building depreciation schedule. But it isn’t generally understood that crane rails, support columns, frames, and the foundation that support the crane also qualify.

  1. 3 Cost segregation not only reduces current federal tax obligations; it may also reduce real estate property appraisals and tax liabilities
  2. 4 The federal tax code allows for retroactive recapture of unrecognized depreciation deductions for facilities/properties built since 1987 (without requiring an amended tax return)
  3. 5 Butler has an exclusive cost analysis tool, called SmartView™, which calculates all facets contributing to total cost of ownership while also accounting for cost segregation savings

SmartView gives project owners a clear picture of anticipated costs and savings related to energy use, maintenance, tax incentives, and more. Results show the cost-saving implications of various building systems and design options, and can include cost segregation, at the pre-build stage, enabling owners to make more informed decisions.

To learn more, contact a Butler Corporate Accounts Manager. If you would like to schedule a meeting, please complete this simple form.

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