Cost Segregation

Novogradac & Company LLP provides specialized knowledge about cost segregation for individual components of property, which is significant when the property is acquired or constructed and different components or asset groups have different recovery periods and placed-in-service dates.

Our professionals excel in classifying assets, analyzing their components and evaluating costs and cost-estimating techniques that segregate or allocate e costs to individual components of property. Our team will provide cost-segregation studies that result in significant tax benefit, while ensuring that property costs are correct and total project costs among components are classified properly.

Our services include:

  • documentation necessary to classify assets into applicable income tax property classes and recovery periods under the IRS Modified Accelerated Cost Recovery System (MACRS)
  • inspection of the property, including walk-throughs
  • reviews of the final purchaser closing statements, draw requests, contractor agreements, change orders and subcontractor agreements
  • review of appraisal reports before and after construction of the assets for any land and other asset valuations
  • allocation of soft costs between asset classes
  • recovery period substantiation
  • and more