Comprehensive Fixed Asset Review
The Ultimate Fixed Asset Planning Idea
Comprehensive Fixed Asset Review
A Comprehensive Fixed Asset Review is a powerful tax planning strategy that evaluates a taxpayer’s entire depreciation schedule to find a multitude of opportunities to accelerate deductions and vastly improve cash flow. While this strategy includes reviewing assets for missed cost segregation studies, for taxpayers with numerous assets, this is a vastly superior planning idea since it reviews all assets for a multitude of opportunities, including:
- Cost Segregation
Commercial buildings are depreciated slowly over 39 years. A cost segregation study carves out components from buildings that qualify for more rapid depreciation, such as land improvements and personal property. » Cost segregation details. - Individual Asset Review
Individual assets are often inappropriately depreciated as part of a building, such as process-related plumbing, electrical, and ventilation systems. This study identifies assets qualifying for more rapid depreciation. - Capital to Expense Studies
The new TPRs allow taxpayers to retroactively review expenditures that were capitalized but qualify as repair and maintenance expenses, such as replacing roof membranes, resealing parking lots, and replacing of HVAC components. - Retirement Studies
Taxpayers often have ‘ghost assets’ in their fixed asset systems, such as removed roofs and HVAC components. A retirement study identifies these assets, allowing taxpayers to immediately deduct the remaining undepreciated basis. - Partial Dispositions
The TPRs now allow taxpayers who make improvements to their facilities to immediately deduct the cost of the removed building components and to instantly write-off undepreciated basis amounts. - §179D Energy Efficient Commercial Building Deduction
Taxpayers who construct new buildings or make improvements to existing ones can take an immediate deduction of up to $5.65 per square foot for investments in efficient lighting systems, HVAC and hot water systems, and the building envelope. » §179D details - §45L Energy Efficient Home Credit
Allows eligible developers to claim a tax credit of $500 to $5,000 for each newly constructed or substantially reconstructed qualifying residence, which includes single family homes, apartments, condominiums, and student housing. » §45L details - Demolition Costs
Demolition costs for building improvements are often capitalized with the cost of a new asset but can now be immediately deducted under the new TPRs - Bonus Depreciation
Bonus depreciation allows taxpayers to immediately write off from 30% to 100% of the purchase price of a new asset, but is often missed. This study identifies missed bonus opportunities. - Intangible Asset Review
Taxpayers often have intangible asset on their fixed asset records that are amortized incorrectly or can be removed, such as an expired non-compete agreement. This study reviews intangibles for opportunities to accelerate amortization.
OUR TECHNOLOGY
Our fixed asset analysis technology was designed in-house and is exclusive to ICS Tax. It has been used to complete hundreds of successful projects for manufacturers, financial institutions, telecommunication companies, retailers, property investors and numerous other taxpayers operating in a wide variety of industries.
Sample reports from of our proprietary software:
CASE STUDY
ICS identified over $5M of accelerated tax deductions for a yearbook and class ring manufacturer. Significant opportunities include treating HVAC equipment installed to keep printing equipment from overheating as personal property rather than real property, identifying repair expenses that were capitalized, and claiming energy efficiency tax incentives.
HOW WE CAN HELP
Our team of specialists is highly experienced in performing Comprehensive Fixed Asset Reviews and have done so for both small businesses as well as Fortune 500 companies. Our proprietary software can upload assets from any depreciation system, quickly review asset depreciable lives, methods and conventions using automated analysis tools, and identify potential opportunities. Our software has a power depreciation system that compares how depreciation is currently calculated to our preliminary analysis. We calculate the additional deduction and additional cash for the current year, the net present value of benefits, and the §481(a) adjustment used on the Form 3115, Application for Change in Accounting Method.
We do this preliminary analysis completely free with no obligation.
If engaged to perform the study, we will perform necessary site visits, review construction documents, conduct interviews, analyze invoices, and do all necessary steps to confirm and document our positions on identified opportunities. We can draft necessary Form 3115s and with our proprietary software, assist in making changes in the fixed asset system. If the study is audited, we provide free audit support.