Minimize Gains on Sale of Condos in Mixed-Use Developments. Condo Tax Basis Allocation Studies

01/09/2018

Traditional cost accounting for mixed-use residential projects often does not properly allocate all construction costs to each section of the property. Consequently, there may be a significant understatement of cost basis for residential condominium units resulting in higher taxable gains upon sale. This is most common within vertical mixed-use developments where residential condos are stacked … Read More

Reduce Taxes on Condo Sales in Mixed-Use Developments with Tax Basis Allocation Studies

12/01/2017

Traditional cost accounting for mixed-use residential projects often does not properly allocate all construction costs to each section of the property. Consequently, there may be a significant understatement of cost basis for residential condominium units resulting in higher taxable gains upon sale. This is most common within vertical mixed-use developments where residential condos are stacked … Read More

KBKG Tax Insight: 5 Tips for Properly Vetting a Specialty Tax Consultant

11/07/2017

CPAs know it is imperative to refer clients to 3rd party consultants for various issues that require deep specialization in an area of tax. In many ways, these specialty tax firms act as an extension of your team and require coordination to deliver results that often have a material impact on a tax return. While … Read More

KBKG Tax insight: Tips for Documenting Qualifying R&D Expenses

10/26/2017

Every company seeks effective ways to reduce their overall tax liabilities. Although traditional tax planning can certainly reduce business taxes, there is often a limited impact, leaving owners and managers searching for additional savings opportunities. The good news is that the Research and Development (R&D) Tax Credit is available to qualifying companies that have or … Read More

New Qualified Improvement Property Category in 2016

09/18/2017

For the most up-to-date information on Qualified Improvement Property, see our latest post. Many tax professionals are still unclear about the newest classification of building improvements eligible for bonus depreciation when placed in service on or after January 1, 2016. That’s understandable considering there has been over a dozen additions or changes to rules relating … Read More

KBKG Insight: Does a Cost Segregation Study Increase the Likelihood of Audit?

08/25/2017

One of the most common concerns that is raised regarding Cost Segregation Studies is whether it increases the likelihood of an IRS audit down the road. While it’s well documented that these studies are accepted by the IRS if performed properly, there isn’t much evidence suggesting the implementation of a cost segregation study on a … Read More

KBKG Tax Insight: Guide to Expensing Roofing Costs

06/21/2017

Each year, tax professionals who deal with real estate must evaluate the most recent building expenditures and determine which items should be written off as a repair expense or capitalized. The most common, and often significant, item that is evaluated is roofing-related work. In many cases, only a portion of the roofing system is replaced, … Read More

KBKG Insight: Tax Court Rejects Taxpayer’s Land vs. Building Allocation

06/13/2017

On May 8, 2017, the U.S. Tax Court released Summary Opinion 2017-31 to conclude that a county assessor’s allocation to land and improvement values were more reliable than the taxpayers proposed values.  The tax court noted they could not find any authority that suggests a taxpayer is qualified to allocate the value of the property … Read More

KBKG Tax Insight: Using Cost Segregation with Estate Planning

01/13/2017

When a client dies, a critical estate planning area for tax professionals involves managing the step-up in basis on inherited assets for estate and income tax purposes. The general rule for real estate is that when a property is inherited, any gains built up during the decedent’s life are not recognized. The beneficiary also receives … Read More

Estate Planning Strategy Using Cost Segregation

08/19/2016

Real estate owners and investors often use cost segregation studies to accelerate depreciation deductions, generate current income tax benefits, and improve cash flow. But did you know that a cost segregation study can also be used as a powerful estate-planning tool?One of the advantages of transferring property at death (rather than by lifetime gift) is … Read More