CPA - Researching Cost Segregation to Offer as a Service

Cincinnati, Ohio
Tax, SDIRAs & Cost Segregation
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CPA - Researching Cost Segregation to Offer as a Service

Gregory Jackson
Member since 2021 · 6 posts · 2 votes

Finally, my first post - As noted in the title, I am an Ohio-licensed CPA investigating whether I could offer a cost segregation service.  As part of my due diligence in entering this market, I am looking for excellent materials to read (please post suggestions). I have noticed that the IRS discusses the audit process and what they look for in reviewing a cost segregation analysis. If possible, I would like to get my hands on a redacted cost segregation report if anyone would share that much information with me.  Assuming I enter this market, I would be happy to offer some initial services heavily discounted to assist in my learning process. 

My Background: CPA for the past 10 years in technical accounting. I recently flipped a couple of houses and picked up a rental in the Cincinnati area. Areas of interest multifamily, cost segregation and tax.

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Shlomo Koheler
Rental Property Investor · centervill in · Member since 2019 · 86 posts · 49 votes
3y

@Gregory Jackson

Well we have done three cost seg

For three of our portfolios SFR

It's normally a teamwork between engineer and a CPA

So if you look into the YouTube channel of Anderson advisors Toby Mathias the accountant there has some good easy to understand stuff about the subject or look for a yona wise which is our provider.

It is very beneficial and being you live in Ohio you could provide some additional insight avoiding their rule of some to have the land valued as 20% and instead accounting for what it's really worth here.

But normally these companies offer an array of 'additional real estate tax/financing services'

Like being a 1031 Trust etc

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  • Buddy Holmes
    Investor · Daytona/Ormond Beach Fl, Charleston/Summerville SC · Member since 2017 · 156 posts · 73 votes
    3y

    Most Cost Segregation Studies that I have seen were done by Professional Engineers.  What does the IRS look for?

    Cheers

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  • Curt Riffel
    Accountant · Dallas, TX · Member since 2016 · 161 posts · 75 votes
    3y

    I am a CPA in Texas, we have had a couple of clients reach out to us to request this as a service. We have an office of 30 people, but it is not something we offer at this time. I reached out to a few Cost Seg providers in our area that are NOT competing CPA firms to refer the business. 

    Some of the larger National CPA firms offer this service already. 

    1Reply
  • Gregory Jackson
    OP
    Member since 2021 · 6 posts · 2 votes
    3y
    Quote from @Curt Riffel:

    I am a CPA in Texas, we have had a couple of clients reach out to us to request this as a service. We have an office of 30 people, but it is not something we offer at this time. I reached out to a few Cost Seg providers in our area that are NOT competing CPA firms to refer the business. 

    Some of the larger National CPA firms offer this service already. 


     Here is the guide that describes the audit technique from the IRS

    https://www.irs.gov/pub/irs-pd...
    0Reply
  • Buddy Holmes
    Investor · Daytona/Ormond Beach Fl, Charleston/Summerville SC · Member since 2017 · 156 posts · 73 votes
    3y

    I took a look at the IRS guide.  WOW  LOOK LIKE YOU NEED A LAWER TO DECIFER!

    EG HVAC seem ok in one case and prohibited in another. Seems like a nice list of typical 5 yr and 15 yr property would be beneficial.  Anyone seen such a list?

    0Reply
  • Shlomo Koheler
    Rental Property Investor · centervill in · Member since 2019 · 86 posts · 49 votes
    3y

    @Gregory Jackson

    Well we have done three cost seg

    For three of our portfolios SFR

    It's normally a teamwork between engineer and a CPA

    So if you look into the YouTube channel of Anderson advisors Toby Mathias the accountant there has some good easy to understand stuff about the subject or look for a yona wise which is our provider.

    It is very beneficial and being you live in Ohio you could provide some additional insight avoiding their rule of some to have the land valued as 20% and instead accounting for what it's really worth here.

    But normally these companies offer an array of 'additional real estate tax/financing services'

    Like being a 1031 Trust etc

    2Reply
  • Gregory Jackson
    OP
    Member since 2021 · 6 posts · 2 votes
    3y
    Quote from @Shlomo Koheler:

    @Gregory Jackson

    Well we have done three cost seg

    For three of our portfolios SFR

    It's normally a teamwork between engineer and a CPA

    So if you look into the YouTube channel of Anderson advisors Toby Mathias the accountant there has some good easy to understand stuff about the subject or look for a yona wise which is our provider.

    It is very beneficial and being you live in Ohio you could provide some additional insight avoiding their rule of some to have the land valued as 20% and instead accounting for what it's really worth here.

    But normally these companies offer an array of 'additional real estate tax/financing services'

    Like being a 1031 Trust etc


     Really appreciate the insight here. Thanks!

    0Reply
  • Kyle MccawBusiness Member
    Property Manager · Keller, TX · Member since 2011 · 1k+ posts · 1k+ votes
    3y

    @Gregory Jackson my accountant uses my Cost Seg that I get from a 3rd party. I have used https://diycostseg.com/ and he seems to be very happy with what they supply for him to process the depreciation. In fact, he told me to do them on every house I purchase.

    McCaw Property Management4.4907 Reviews
    WebsiteView Page
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  • Gregory Jackson
    OP
    Member since 2021 · 6 posts · 2 votes
    3y
    Quote from @Kyle Mccaw:

    @Gregory Jackson my accountant uses my Cost Seg that I get from a 3rd party. I have used https://diycostseg.com/ and he seems to be very happy with what they supply for him to process the depreciation. In fact, he told me to do them on every house I purchase.


     Thank you so much for sharing this.

    0Reply
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