All Forum Posts by: Yonah Weiss

@Celia Moore Thanks so much for sharing these resources. I have heard from several colleagues as well that lobbyists have been successful keeping 1031 exchanges  from being axed time and time again. 

No. Splitting out the business (goodwill), is not cost seg. That portion is 'depreciable' over a 15 year life span, so I see how it can be viewed as such. This is common to do in self storage, MHPs or other real estate that a business is associated with it. 

@Kurt Granroth the two groups you mentioned were the two I was going to suggest first. While I haven't invested with them, I've known them and worked with them since their respective inceptions.

You might also want to check out Sunrise Multifamily who recently acquired one of Whitehaven's properties. There's Bakerson - Ruben Greth, that usually focus on much shorter holds, 12-24 months. And Zev Hendeles of 3rd Ave Investments. I'm sure there are many more, but those are the one's I personally know.

Smart investors ;)

@Kodi Clark This is something I know a little bit about ;)

As @Ashish Acharya mentioned, certain purchases after the acquisition can qualify for 100% bonus depreciation (like appliances or furniture), otherwise you would need to have a cost seg study completed in order to identify the components within the property that depreciate under 20 years, (like 'personal property' and 'land improvements'), and are eligible for bonus depreciation.

Whether or not a it will be beneficial for you in your situation should be discussed with your tax advisor. Most cost seg companies can provide a free analysis to see what the difference of straight-line depreciation vs. cost segregation to see the potential tax benefit.

@Blake Harris I'm not sure I fully understand your question, or you have a full understanding on how cost segregation works, but I'm happy to clarify a couple points.

Doing a cost seg on a property will help to frontload a certain amount of depreciation to get you bigger tax deductions in the earlier years. Each partner will receive the amount of depreciation per year according to their percentage of ownership. 

That tax deduction will not give you a refund check, so you should not consider it as cash (which is what confused me in your question "would I be able to take the depreciation amount from the cost Segregation study and use it to invest in the next property by myself?"). It will help to lower your taxable income, which may create more cash-flow.

Joyce, An attorney I know Jaime Michelle Cain in upstate NY created a NY advocacy group for landlords called Under One Roof https://www.underoneroofny.org

She also hosts a weekly roundtable via zoom with updates and support for landlords. You can check out more info here https://boylancode.com/rert/

@Sarah Waterman I would be happy to help, as you know I work for another cost seg firm, but we also have a 1031 QI company in house. May not be your best option, but thought I would put it out there 😁

STRs if the average stay is less than 7 days, it's not considered a rental activity. If its not a 'rental activity' then its not subject to passive loss limits like other real estate. However you need to have "material participation' in the STR, which can be difficult for many, especially if it is out of state. But if you meet these requirements, the depreciation can be used against your W2. Make sure to discuss with your accountant.

Check out the rules here: 

Treas. Regs. Sec. 1.469-1T(e)(3)(ii)(A):https://www.law.cornell.edu/cfr/text/26/1.469-1T

Shoutout to @Brandon Hall and his ever informative FB group, where this topic is discussed extensively.

Happy to clarify this. To reiterate, as long as you did not elect out of it beforehand, you can elect Bonus depreciation in a future tax year, even if you filed taxes in previous years. So in your example, you can claim 100% bonus depreciation in 2021 on a property purchased in 2019, as long as you did not elect out of it in the previous tax returns. An example of electing out of bonus would be to do a regular cost segregation in the earlier years, or even breaking out and allocating certain assets to faster depreciation schedules. But if you just lumped everything together on straight-line depreciation, you can change the accounting method with a form 3115 and claim bonus depreciation in that tax year, which will catch up whatever accelerated depreciation you missed, and apply it going forward.