Latest / Financial Survival Network / This Man Can Cut Your Tax Bill By 100's of Thousands -- Joseph Fiery #5961

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This Man Can Cut Your Tax Bill By 100's of Thousands -- Joseph Fiery #5961 · Financial Survival Network

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  Basically, everyone has a gross taxable income and you can reduce your gross taxable
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  income and that's what your income taxes are calculated on. And one way you
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  can reduce it is by having expenses. The IRS recognizes that properties being owned
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  are being quote unquote used up during their light and the life of a residential
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  property is twenty seven and a half years. You are listening to Carrie Leutz's
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  Financial Survival Network where you get valuable information you just can't find anywhere else to
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  thrive in today's trying times. You need the Financial Survival Network now more than
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  ever. Go to Financial Survivalnetwork dot com and get your free newsletter and gift.
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  Financial Survival Network now more than ever ed. Welcome. You are listening
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  to watching the Financial Survival Network. I'm your host, Carrie Letz. Well,
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  hey, you're looking to save some money on taxes, especially if you're
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  in real estate, then the person you are about to hear from is somebody
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  you want to pay close attention to. His name's Joseph Viery and the company
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  that he runs is called the US Tax Advisors Group. Joseph's great to be
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  here with you. Thanks for coming on, Hey, Kerry, thanks for
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  inviting me, So tell us how this works. Cost segregation studies, what
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  are they, why do you need them, and what good are they?
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  Perfect Well, let me start by saying that we're an engineering base firm and
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  I'm not an accountants. I'm not giving anybody accounting advice. I'm not in
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  attorney. I'm not giving anybody legal advice. So I've been in the business
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  since two thousand and seven and I'm going to give you a high view of
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  what costs EGG is. Basically, everyone has a gross taxable income and you
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  can reduce your gross taxable income and that's what your income taxes are calculated on.
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  And one way you can read you said is by having expenses. The
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  IRS recognizes that properties being owned are being quote unquote used up during their light
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  and the life of a residential property is twenty seven and a half years,
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  for commercial properties thirty nine years. These two years are made up by Congress.
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  I have no idea why they pick those years. Somebody could google that
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  and get a better answer than me. But bottom light is they're saying you're
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  using up your property. So if you divide the building basis by twenty seven
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  and a half or thirty nine years. It doesn't take an incredibly economically sound
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  person to know that you're getting a little bit of an expense every year.
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  However, the correct waiting to appreciate a building, according to the IRS,
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  is by breaking out the shorter light assets of the building. Okay, what
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  do I mean? I'm talking about the interior the building is five years,
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  which are things like countertops in cabinets and flooring and window coverings. And then
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  fifteen year life of the landscaping or the outside of the property land improvements like
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  irrigation like driveway, swimming pools, fencing, and so if you have the
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  fifteen year in the five year property, we usually find about thirty percent of
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  the building basis that can be put in these shorter lives. So let's do
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  a little math. Let's say that you have a million dollar building and we
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  find two hundred and fifty thousand in the shorter life assets fifteen year and five
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  year, you can take well, if it was twenty and twenty two,
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  you could have taken one hundred percent of the two hundred and fifty thousand and
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  completely written that up against your taxes, which is huge. That means if
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  you had a five hundred thousand dollars taxable income. I just cut it in
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  half, and now you've got a two hundred and fifty thousand, So I've
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  saved the property owner or owners a ton of money. And so that that's
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  basically what we do in costs EGG. The IRS recognizes all all of these
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  short life categories and components and as an engineering company, we identify them,
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  we put the correct cost to them, and basically we give the accountant or
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  the taxpayer the report. Then it shows what can be accelerated so that they
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  can significantly reduce income taxes in the current tax year. I mentioned one hundred
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  percent was last year. It's now reducing every year for the next five years.
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  So in twenty three it's going to be it's not going to be one
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  hundred percent. It's going to be eighty percent. It's not a big deal.
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  All it means is I'm going to be able to take that same example,
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  the two hundred and fifty thousand dollars and give the taxpayer eighty percent of
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  that money and then the twenty percent they're still going to get, but it's
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  going to be over time they're going to get the rest of that all of
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  that depreciation over the next following couple of years. So that's basically how coste
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  works, and you know a little bit and how bonus appreciation works. Okay,
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  he's so many real estate investors is failed to take advantage of this,
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  don't they? Oh my gosh, you know I've been doing this since two
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  thousand and seven. The first objection I got back in the dark days was
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  oh, this must be a scam, this can't be true. Well,
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  now, all I needed to do is tell anybody to go to the to
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  Google Google auto technic guidelines for cost segregation. It's compiled by the IRS.
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  That's our bible or monitor. We follow the IRS and the autotechnic guidelines.
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  So that question is done. Everybody knows accounting and taxpayers that this is legitimate.
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  Now it's just a matter of letting all the accounts and taxpayers know that
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  this is the correct way to appreciate a biling. Okay, So is this
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  an engineering study that takes place to you? And is it the property way?
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  We're doing this. Back in the day, when I first started,
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  we only dealt with bigger buildings, like a million dollar building basis, And
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  what do I mean by building basis? Here's how you calculated whatever you paid
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  for the building. This is not what it's worth. What you pay for
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  the building less the land is the building basis. That's the number I have
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  to work with. So the online is we take the building basis and we
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  work off of that number, and we calculate how much accelerated appreciation the taxpayers
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  entitled to. Okay, right, so now it's a lot different than it
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  was. At what price of a property? Does this become worth doing?
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  If I buy a house for two hundred and fifty thousand that I'm renting out
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  to you know, it's an investment property, should I do a cost SEG
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  study? Well, you know what did further embellish on your last question.
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  So what happens is that if we have a building basis in the old days
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  of a million dollars or more we never used to deal with small buildings,
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  we would do the detailed engineering study, which meant we would have to send
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  somebody out to the property to document the property, take photos, measure everything.
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  The engineers would take all that information and then a would do their calculations.
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  However, about oh jeez, seven or eight years ago, we came
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  up with an analytical approach where we basically do not need to go to the
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  property and we can do everything in house. Now, we only do this
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  for smaller buildings that have a basis of seven hundred and fifty thousand dollars or
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  less. So if we do the analytical study, the price is a lot
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  lower. It's you know, we charge anywhere from six twenty five to six
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  seventy five for an analytical study. So we can now study buildings as low
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  as a single family home that has a building basis of seventy five thousand dollars
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  and we can make it it work. If you have a building basis over
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  seven point fifty, then it's going to be more expensive, but then the
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  return on your investment, the return on the fee is going to be a
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  lot higher because your building basis is a lot higher. We're going to save
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  somebody with a million dollar building two hundred thousand. We're not going to charge
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  you six twenty five or six seventy five. We're going to charge you probably
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  for three four thousand. Well it depends. I'll give a range of from
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  two to four thousand on that size of building. So it's still gonna be
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  worth it, but we will have to go out to that building, the
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  bigger buildings and do the on site review. Okay, and the IRS has
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  no problem with you remotely doing these studies. No, I'll be very clear.
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  It's in the Auto Technic guidelines. However, it's not the number one
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  methodology. The number one methodology is if we do the detailed engineering and we
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  go out and we measure everything, we do it all correctly. What we're
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  giving the IRS when we do the analytical study is we're using our database of
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  thousands of thousands of properties. We're looking at the property individually. We still
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  look at it. We still want to see the inside, but we can
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  see the inside from photos. So we're doing a really good job. Is
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  in the yield aren't as high as a detailed engineering, but for somebody with
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  a smaller building, it's still going to make a very sound investment. You're
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  still going to get an accelerated depreciation, and you're still going to get US
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  Tax Advisors Group to defend the report. It questioned by the IRS. Okay,
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  I like it. I like the fact that you've made it a much
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  easier process and you don't have to go out there because I know that you
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  know prior you had to go out. Yeah. Yeah, we did every
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  building and so that's why, you know, unless you owned a big building,
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  you really wouldn't make sense to your costs head. But nowadays it does
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  make sense though. I have lots of clients now with single family homes one
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  two fifty and now they can they can afford to do it all. Right.
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  Hey, really fascinating. If we want to contact you, perhaps you
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  retain your company to do a study, Joseph, how would you go about
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  doing that? Yeah? And what we do how the process that works carry
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  is that we provide a no cost estimate and a proposal of course the fee
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  and basically if you go to U S t A g I U S T
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  g I dot com and you will find uh. I think the first one
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  I would recommend is schedule a call with one of our staff members just to
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  go over, you know, the process and to make sure that you know
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  they're they're a good candidate. And then we will get it. We will
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  send you a link and you'll fill out your property information. I just need
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  some basic questions. If it's a current tax here acquisition, like if you
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  bought it in twenty three. Now we're dealing with the twenty three tax.
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  Here, I just need to know how much did you pay pay for it?
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  Do you know the land allocation? And if not, I'll estimate the
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  land allocation, how much of that we got to deduct from the acquisition cost
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  when you bought the property, and the address to the property. From that
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  information, I can that's all I need if it's a look back study.
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  And by the way, I can go back fifteen years to do a look
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  back study. If it's a look back study, you already filed your tax
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  return. So I need a piece of paper called the Federal tax depreciation schedule
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  where you or your accountant is already I answer the questions I need, which
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  is how much is the building? Basis, when did you buy the building?
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  And are there any capitalized improvements since you bought the building? So that
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  one piece of paper. Really all I need is the act outers to the
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  property and the depreciation schedule, And if we need more information, we'll reach
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  out. But basically that's it. And then I follow up with an estimate
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  and the fee, and then you take it back to your accountant or your
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  team and decide whether this is going to be something you want to do right
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  and then obviously if you missed it when you bought it, you can carry
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  back, right, Yeah, and you can still get one hundred percent bonus
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  if you fall in one hundred percent bonus years. So if you bought the
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  property of twenty seventeen to twenty twenty two and you haven't done it, those
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  are the one hundred percent bonus years. I can go back and calculate one
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  hundred percent bonus. But anything acquired in twenty three now is eighty percent,
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  and then twenty four or sixty forty twenty zero, all right, but even
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  when it goes to zero, then you still so you write it off over
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  how long a period do you do it? I yours. You'll get the
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  bulk of it eighty percent in the so don't forget this carry I started in
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  two thousand and seven where we had no bonus depreciation, so it was never
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  a factor. So I know a lot of my competitors that use bonus appreciation
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  to scare their clients and say, oh, you have to do it this
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  year. I'm not in that camp because I go back so far that we
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  never have bonus and it was not a big deal. I still was crazy
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  busy what it means is instead of getting your one hundred percent or eighty or
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  six, you're going to get a big chunk of it, like say about
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  eighty percent the year you do the study. The other twenty percent you're going
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  to get over the next five years. It's a mathematical equation that And so
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  I can't say it's five years exactly. It could be four years, it
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  could be six years. It just depends on how how much of the property
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  has fifteen year and how much is five year. And you blend all of
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  the map together, and that tells you, you know, so once it
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  goes down to zero, I will still be crazy and busy, and people
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  should still do cossat. Okay, I like it, and it's all legal.
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  It's all totally there for you. You know where I've seen this,
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  and I've worked with a number of real estate investors with single family homes,
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  condos, things like that. Can you You can do it for condos too,
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  right now. For condos is a little different of an animal. We
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  charge one hundred dollars more to do a condo. And I'll explain why.
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  It's very simple is that the condo owners a lot of times don't realize this
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  but either it's a commercial or residential condo, all the condo owners own the
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  land and they own the land improvements. So when we go out to a
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  condo, even though you might have one condo out of one hundred, we
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  have to look at all the land and divide out what your one percent you
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  own. So therefore it takes us a little bit more time because we're looking
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  at all the land improvements. If it's a residential condo, we're looking at
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  the swimming pool, the clubhouse, the parking lot, and then we carve
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  out. If you own one condo and you own one point five percent of
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  that whole condo complex, then we have to carve out the one point five
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  percent. So that's why condos are a little bit more, but it's still
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  valuable. It still works. It still seems like the land is less of
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  a percentage, so your potential right off could be higher. Do I have
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  that right? No, it's gonna be a good report, but it's going
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  to be pretty much in the same. The math will work out pretty much
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  the same as that you own a single family home, because usually it is
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  if there's one hundred condo development, you only own one percent. That's still
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  going to be a big number. You know, one percent of a huge
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  hundred one hundred unit condo is going to be there's gonna be a lot of
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  land improvements. It's going to be worth a lot. All right. Oh,
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  I like it. I like it because it's really proof that something like
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  ninety eight percent of the people out there who file tax returns are paying too
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  much money, right right, and now I want them My first defense when
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  I talked to my clients, as I say, look, here's what I'd
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  like you to do. I'd like to take your tax savings and either improve
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  your properties or buy more property. That's what I want you to do.
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  Now. Whatever they do with the with the money, I don't care.
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  But I think if you're really in this game to be a savvy investor,
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  take your tax savings and grow your kingdom. All right, well I did?
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  Okay, just tell us again how we connect with you. Well,
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  it's US Tax Advisors Group Incorporated. But simple, it's you stagi dot com.
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  All right, Hey, got a question for Joseph myself. The email
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  addresses kl at Carrie LUTs dot com. And while you're at it, you'll
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  find the link to Joseph's site on our site Financial Survival Network dot com.
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  Make sure you sign up for your free newsletter so you find out about opportunities
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  like this. I mean, look, you got three years to file an
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  amended tax return. If you miss this, it could be a huge savings
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  on your taxes. Well, here's here's one. Let me stop you right
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  there. Sure all the work that we do, the word that starts with
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  an A that you mentioned is not in our vocabulary. Cost segregation is not
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  an amendment. Cost segregation is guaranteed by the IRIS and by IRIS regulations.
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  Even if you do a look back study, we don't amend the return.
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  The IRIS grants you special dispensation. If you go do a look back study,
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  you have to file a form called the thirty one to fifteen and change
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  your accounting method. But I want to make sure it's not amending. It's
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  guaranteed approval by the IRIS. They must take a thirty one to fifteen for
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  cost segregation. They don't have to take it for any other changes, but
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  for cost segregation, it's grand bothered it in they must approve cost aggregation.
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  So if anybody asked me about amending the return, I tell them don't do
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  it. If you have to mend a return. That's my advice, because
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  amending returns is a red flag, all right, I love it. So
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  it's not an amended return per se. I mean, effectively it is,
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  but it's it's not an amended return that's going to grow added scrutiny. It
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  has to be accepted by law, which is a great thing. And look,
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  you might be depreciating your property over twenty seven years and this could be
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  a huge tax savings to you if you do it promptly. Did they only
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  have three years to go back Joseph for killing It's a mathematical equation. There's
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  no bright line in the sand. But I will tell everybody with my experience
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  about fifteen years now. I don't care how old the property is. George
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  Washington could have slept in the property I'm talking about when somebody bought the property.
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  We can go back fifteen years and I'll do the estimate for no charge,
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  and if it doesn't work, I'll be the first to tell them.
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  You know, it just doesn't work for your property. What I like to
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  see is I like to see ten times the fee. So if I'm charging
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  you six twenty five, I want you to save six two and fifty in
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  income taxes. If you're not gonna save that amount of money, I'll be
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  the first to say I wouldn't do it if I re you. Now,
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  if you want to do it, that's okay. But my recommendation is I
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  think it makes sense for ten times my fee. Okay, I'd say good.
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  Anytime you can get ten X on an investment and immediately without any risk
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  whatsoever, you should probably do it. Got a question for Joseph myself email
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  address KL at Carrie Lutz dot com. Make sure you go sign up for
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  your free newsletter. You'll get all that info. Joseph's contact info will be
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  in it, and Joseph really fascinating stuff. Thanks for coming on. We'll
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  talk to you again soon, all right, Kerrie, thank you, good
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  job. Thanks for listening to Carrie Letz's Financial Survival Network. Your solution to
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  today's trying times. For the latest, go to Financial Survivalnetwork dot com.
• 19:06
  Financial Survival Network now more than ever