What is Cost Restaurant Segregation?

Restaurant Cost Segregation is an engineering-based approach to identifying assets within a restaurant building that can be reclassified into a much shorter depreciation recovery period than the building itself. Restaurant Cost Segregation Studies have proven an effective means of reducing owners income tax liability. Many asset components within restaurant properties may be depreciated over a 5 year or 15 year recovery period versus a straight-line 39 year recovery period. This accelerated depreciation allows the restaurant owner to reduce current income tax liability and significantly enhance cash flow improving your bottom line.

The IRS has released industry specific guidance regarding cost segregation studies in the restaurant industry. Now restaurant owners/operators can accelerate depreciation on 20-40% of total building costs. This is an effective means of reducing your income tax liability. Many of your asset components within restaurant properties may be depreciated over a 5 year or 15 year recovery period versus a straight-line 39 year recovery period. Accelerated depreciation allows the restaurant owners to reduce current income tax liability and significantly enhance cash flow, improving your bottom line.

Our new team has extensive estimating, engineering, and construction experience permitting us to identify and quantify items of personal property accurately and in a manner acceptable to the IRS

• It’s Not Too Late – Restaurant Cost Segregation Studies may be performed on properties you currently own as far back as 1987. The IRS allows a taxpayer to file Form 3115 (automatic change in accounting method) and receive a “catch up” tax deduction in the current year without amending prior tax returns. This deduction can be applied to current income tax liability significantly reducing the amount of income taxes owed this year.

• Choosing a Cost Segregation Provider – The IRS has continued to validate, uphold and improve the value of a Cost Segregation Study. Meeting these guidelines requires the knowledge of construction costs and techniques as well as related tax law. Scarpello Consulting has extensive estimating, engineering and construction experience. Synergy Restaurant Consultants have been restaurant efficiency experts for over 20 years. This new team can identify and quantify items of personal property in a manner acceptable to the IRS.
  Providing a turnkey solution for your CPA – Cost Segregation is a specialized area of tax. Scarpello and Synergy works directly with your CPA providing all necessary documentation and support.

Want to learn more? Contact Synergy Restaurant Consultants right away to see how you can truly benefit in a major way through Cost Segregation.