Accelerated depreciation for first rental

[Jen Loch]

Hi. Looking at my first str! I understand land is excluded from the cost segregation study and that an easy estimate is 20% of purchase price. I’m confused on why some properties result in 20% and others 40%… are there characteristics to look for to get higher amounts

if you renovate after, would it make sense to do cost seg study after Reno or before and then do the individual Reno items as separate deductions?

thanks for any ideas!

[Bill B.]

If you own a condo in a high rise you own zero land. 
if you own a 400sf shack on Lake Tahoe you own 100% land. 

Remember, you aren’t creating ANY tax deductions. You are only pulling them forward to have fewer deductions in the future. And if you ever sell they get paid back. So make sure you think your income and taxes will be lower in the future. 

Your CPA should answer the before / after Reno, and maybe even if it’s worth doing if they’re any good. Your cost segregation company or your CPA or both will have to come to an agreement on what percent the land is. There is NO standard percent rule.