successful Cost Seg starts with an Understanding of the Depreciation Incentive
There are two accounting options that can be used for Rental Property.
Options
- Use one category for depreciation and lump all the components into this one category. Obviously, this would have to be the category that gives the least amount of depreciation to be compliant.
- Segregate all the components of the property into their specific category. This is a more accurate accounting method. Multiple categories give a larger amount of depreciation back to the property owner.
Why do Rental Property owners get this Depreciation write off?
The IRS comes up with incentives to get people to do certain things with their money. Buying assets enhances their community. So, for businesses the IRS gives businesses the total cost of some assets over time in the form of depreciation. TAKE ADVANTAGE OF IT!