ME158-WEB - Purchase Price Allocation and Cost Segregation Studies: A Team Approach

Registration

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Webinar Course Description

A Cost Segregation Study dissects the construction cost or purchase price of real property that would normally depreciate over a long period (27.5 & 39-years) and reallocates costs into shorter tax lives of 5, 7 or 15-years. This two-hour intermediate course will provide background information, depreciation rules, and how a cost segregation study is performed in conjunction with purchase price allocation valuations.

Recommended Pre-Reading

Valuing Machinery and Equipment: The Fundamentals of Appraising Machinery and Technical Assets. 4th Edition - Chapter 17 Cost Segregation

Course Audience

MTS, ARM, and BV appraisers

Instructor Information

Walter O'Connell , ASA | Walter O'Connell Tax Services, LLC

Walter O’Connell is the Founder and Managing Director of Walter O'Connell Tax Services, LLC (“WOTS”), and is responsible for a variety of projects including the valuation of tangible assets for purchase price allocation, financing, tax and depreciation purposes, property tax analysis, operational and technical due diligence reviews, and cost segregation studies. Walt has extensive experience in machinery and equipment valuation, and cost segregation studies in the hospitality, telecommunications, pharmaceutical, manufacturing and real estate industries. During his career, Walt has conducted on-site inspections of over 1,000 properties, and his technical reviews and valuations have appeared in reports for a variety of organizations.

Prior to the founding of WOTS, Walt held the position of Senior Consultant of Cost Segregation Service and Senior Valuation Manager at Porto Leone Consulting, LLC and was responsible for the development of their national cost segregation practices. Walter holds a Bachelor of Arts degree in Economics and Bachelor of Science degree in Finance from Kean University of New Jersey and a Master of Arts degree in Economics from Montclair State University of New Jersey.  Walt continues to strengthen his credentials by not only taking, but also teaching, technical courses and seminars associated with the valuation of machinery and Cost Segregation. Walt is an Accredited Senior Appraiser (“ASA”) with the American Society of Appraisers, and a Member of the American Society of Cost Segregation Professionals (“ASCSP”) and maintains comprehensive relationships with numerous design, manufacturing, appraisal and economic firms and associations.

Agenda

The following topics are covered in this course:

• Important Definitions.
• Depreciable Assets.
• Cost Segregation Overview.
• Evolution & Legal Framework.
• Methodologies.
• Qualifying Property.
• Calculating and Correcting Depreciation.
• Cost Segregation Benefits.
• Understand the importance of proper asset classification for federal tax purposes.
• Identify assets that often qualify for a shorter tax life.
• Begin to properly classify assets between personal property  and real property for federal tax purposes.
• Be able to calculate deprecation and fix incorrectly reported tax deprecation.
• Be aware of the tax benefits of proper tax classifications and cost segregation studies.
• Closing Remarks.

Learning Outcomes

Upon completion of this course,students will be able to:

• Explain what cost segregation is, how taxpayers benefit from it, and how it has changed over the years;
• Identify tax issues that should be considered in conjunction with a cost segregation studies;
• Recognize the potential impact of cost segregation on estate planning;
• Discuss the impact of tax reform on cost segregation;
• Discuss cost segregation opportunities related to the tangible property regulations and disposition regulations; and
• Identify new opportunities to immediately deduct abandoned building components, avoid recapture tax, and expense demolition costs.