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Fixed Asset Review

Asset Review

At the Tax Analytics Group (TAG), we perform fixed asset review studies that drastically improve cash flow by accelerating tax depreciation deductions. These studies are akin to cost segregation studies in that they expidite the timing of depreciation, which nets against taxable income and reduces your current tax liabilities. However, unlike a cost segregation study that only looks at buildings, a fixed asset review evaluates all of a company’s fixed assets and identifies those qualifying for more rapid depreciation, such as:

  • Business signage, specialized plumbing or electrical, countertops and kitchen equipment
  • HVAC equipment used for cooling computer equipment or perishables
  • Land improvements, such as storage sheds misclassified as buildings
  • Motor vehicles with a gross vehicle weight rating (6000 GVWR) not subject to luxury vehicle caps
  • Expired intangibles
  • Assets with missed bonus depreciation

Capital to Expense Study

This study scours all of a company’s fixed assets for immediately deductible items, such as:

  • Roofing and parking lot repairs
  • Carpet replacement
  • Repainting
  • Equipment and building maintenance
  • Repairs due to severe weather or accident

Ready and Available Analysis

Often, there is a lag between when an asset is ready and available for service and when the taxpayer begins depreciation. For example, equipment requiring only nominal setup can be depreciated when purchased rather than installed. A ready and available analysis corrects the in-service dates of assets, which is especially beneficial when assets are moved from non-bonus to bonus depreciation years or from 50 percent to 100 percent bonus depreciation years (e.g., from 2012 to 2011).

 

While we perform traditional cost segregation studies, TAG is the only firm with Fixed Asset Express. This powerful, internally developed software analyzes fixed asset registers, identifies tax-saving opportunities, and automatically quantifies benefits.


Sample Reports


Success Stories

  • A regional bank received benefits totaling $500,000, much of which came from reclassifying assets previously depreciated over 39, 15 and 7 years to 5-year property. Examples include signage used to identify the bank, vaults, and “man traps” bulletproof doors designed to trap would-be robbers.
  • A steel manufacturer received several millions in benefits for immediately deducting the sizeable expenses for maintaining the refractory brick inside the furnaces.
  • A manufacturer of building materials received a $250,000 benefit, primarily from process-related plumbing and electric, land improvements, and equipment originally depreciated over 39 years.

 

Do you want to know more on how we can help improve your cash flows and reduce your taxes? Please contact us for a free consultation.

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