Real Estate and Construction Newsletter December 2016
Take Advantage of Anticipated Tax Reductions with a Cost Segregation Study
As is generally the case after an election, we’re sure to spend the next several months speculating over what’s to come with a new administration. With a Republican President and a Republican-controlled Congress preparing to take office, one thing we certainly anticipate from a tax planning perspective is a reduction in tax rates across the board beginning as early as 2017.
With that in mind, accelerating tax deductions into 2016 will not only improve a taxpayer’s current year tax situation, it may very well result in a permanent tax benefit. Often times, accelerating deductions or delaying income provides a current year tax benefit which is truly only a timing difference because the taxpayer would have been eligible for the same deduction in subsequent tax years. However, if the top individual tax rate is reduced by 7%, as is speculated, the same deductions will be far less valuable in 2017 and beyond as compared to 2016.