Cost Segregation Walkthrough on a 276-Unit (HUGE Tax Savings)

[@MendyMentz]

Yona CLEARLY knows his stuff and is an expert in this field.

[@YonahWeiss1]

Thanks so much Mendy!

[@lusu6804]

Yona is PURE GOLD!!!! We need more shows with him.

[@YonahWeiss1]

Thank you so much!

[@ndaatweg00]

By far, one of the best episodes!! Thank you!💠👑

[@YonahWeiss1]

Thank you!

[@LongtowerNyc]

This is savage golden nuggets! Thank you for this.

[@michaelmiz89]

Great educational video. I'm an accountant w/ clients in this industry and your video just opened up a world of possibilities. Very much appreciated!

[@YonahWeiss1]

Thank you! Let me know if I can help.

[@joepschmobly]

The greatest real estate video on the web! Thank you!

[@YonahWeiss1]

you're too kind 😁

[@gerardoleyton9587]

Thanks for the two videos #1&2 new to this field, will help me get going in 2022 and beyond. Again thanks, much success in your business ventures and beyond.

[@jaytrg]

So helpful. I wish I have listened to this video many years ago.

[@lllukiosas59]

This is incredible. Thank you Yonah!

[@emersonridley4118]

Would love if you all went over recapture tax as well with specific example numbers like your last episode. Great content!

[@l_Ryi_l]

1031 exchange, avoid recapture

[@YonahWeiss1]

we spoke about it briefly at the end of this video

[@joemjoza9803]

@@YonahWeiss1 great and insightful content. Thank you. The strategy that you brought up @ 23:30 isn’t that the same as just deferring those 1031 exchange gains through just recategorizing them? Offsetting the cap gains from a previous 1031 exchange with some cost seg depreciation. That cost seg’d depreciation will be recaptured again when you sell. I hope I’m not missing anything.

[@emersonridley4118]

@@YonahWeiss1 thanks Yonah! I’ve sent some folks your way that didn’t know about this process. May message you on one of your platforms for additional questions if you don’t mind. Thx for sharing the info.

[@YonahWeiss1]

@@emersonridley4118 please feel free. Thank you.

[@LoveColorado]

Checking in from Steamboat Springs, CO. So many great nuggets of information. Thank you all for taking so much time to go through each majors d minor on the property.

[@kellyiannone]

Great part 2; loved that you walked a property. I learned the 15 year for exterior.

[@JNatella]

the handle in the middle of the cabinet doors is a new one for me

[@Andys_Auto]

I learned quite a bit with this video. Thanks guys. Very valuable

[@sandrazarate6859]

Great video, Great content!!! Thank you

[@moshemayer4817]

#betterthanharvard level! Enlightening. Hands on. Elucidated then translated. Truly an awesome episode! Thank you Yonah Terrence and Chris!

[@angeltolentino4]

Such an awesome episode! I had no idea cost seg goes into so much detail

[@YonahWeiss1]

Thanks so much!

[@sandrazarate6859]

Me neither, I want to master this to help my clients that are real estate investors.

[@YonahWeiss1]

@@sandrazarate6859 Thank you!

[@dennismc8145]

I love this episode, but your wow this is amazing in a super monotone doesn't sound right. Throw some excitement into your wow this is amazing.

[@kcjeffery]

Is spending thousands on an engineering study necessary when it's pointed out at 6:50 that the values are ultimately just fudged to match the purchase price. You can just pick if an item is $200 or $600? How would you argue that with the IRS? It would be simpler if they just went with a generic % of purchase price for a variety of different building types.

[@DavidAzizinamini]

Great video!

[@yoelfriedman4157]

Full of knowledge ! Thank you.

[@YonahWeiss1]

I appreciate it.

[@georgerobertsiii]

Great work Yonah!

[@Salty4eva]

He’s like a Hasidic tax ninja

[@5116david]

Yona seems like a Great accountant

[@mdmd6388]

What if I purchased a multi family 5 years ago, can I still use the five year depreciation schedule if I did not use it before?

[@mrchatterbox2844]

Yes. It's called a look back study.

[@Mase326]

8:40 is clear proof Yonah in fact IS a standup comedian… 😂

[@jondean1144]

What happens if I do a 1031 exchange five years after using cost segmentation?

[@filipfs7749]

Great content, thank you! Can this be done on single family to?

[@YonahWeiss1]

yes. as long as it's not your personal residence.

[@JSRDesign23]

Do you need a Certified Cost Seg Engineer or can I do the cost seg with my CPA?

[@nborisov8]

WOW! Thank you!!

[@jgg204]

If you take too much bonus depreciation and leave too little on the 27.5 depreciation schedule, for buy and hold investors who plan to hold properties until retirement don't you run the risk of running out of enough deductions/depreciations to offset the rental income? (and risk having a tax liability in later yrs of ownership?)

[@YonahWeiss1]

Or just keep buying more properties...

[@MrErzberg]

There are time value of money considerations here as well. A dollar now is worth more than a dollar 27.5 years from now.

[@YonahWeiss1]

@@MrErzberg very true, especially when you consider inflation...

[@ruchitpatel5956]

fantastic piece of knowledge!! Love it, thank you so much. One question: Considering all the amenities outside such as swimming pool, grass, sports area, leasing office, are we depreciating more than the total house price? As an example, say house( subtracting lot ) is $270,000 and most people depreciate that entire price over 27.5 years. Are you saying now we can depreciate maybe $350,000 over 5 years!? or some portion of $270,000 over 5 years?

[@YonahWeiss1]

The total value of segregated costs, must add back to equal the purchase price. You cannot depreciate more than what was spent.

[@ruchitpatel5956]

@@YonahWeiss1 Understood, thanks. I appreciate you taking the time to reply. If you don't mind, following up with one more question: In your experience, how much % of the total house price ( subtracting lot ) is approximately depreciated over the first year, the second year, and the third year? I think you said around 20% in the first year, and a bit less every year after that, correct!?

[@YonahWeiss1]

@@ruchitpatel5956 that is correct. On average you can take 20% upfront, which would leave the remaining 80% depreciating on a 27.5 year schedule.

[@ruchitpatel5956]

@@YonahWeiss1 Wow, that literally means, most of the 20% down payment one pays to buy an investment property, gets depreciated!! WOW. So, imagine, someone sells $70,000 worth of shares as capital gain, then buy a house with all of that money as down payment, good chance most of those capital gain won't be taxed, as deduction might be almost $50,000-60,000 of the house worth $300,000-330,000 !! and then keep repeating every year!! love it. Looking forward to talking with you/your-team on a call, I have scheduled via your website.

[@YonahWeiss1]

@@ruchitpatel5956 That's correct. Looking forward to speaking

[@billsmithmole]

This was incredibly informative! As someone who is just getting into small multi-family, does cost seg scale down to the duplexes and quads? Does it make sense to pursue the accelerated bonus depreciation?

[@YonahWeiss1]

Thank you. It certainly can.

[@garciavashchino1]

@@YonahWeiss1 Awesome, I asked the same, glad i read the comments. Is this only for Multi, or can I take a look at my personal home?

[@billsmithmole]

@@garciavashchino1 I'll take just a guess and say no, I don't think you can depreciate your personal home in any regard?

[@bmwlover0809]

Can you do a cost segregation study on a property you are building?

[@YonahWeiss1]

Yes. The depreciation will begin once construction is complete and the property is placed in service.

[@alexfailaev]

Great video and content! Is the 100% bonus depreciation must occur on the year it was purchased? Or, can I cost seg and start the bonus depreciation on the following calendar year? For example, if I purchased a property this year but did not do the cost seg study, can I do the study next year for the bonus depreciation? Thank you!

[@YonahWeiss1]

You do not need to take 100% bonus in the first year of ownership, as long as you don't opt out of it. Meaning, you would have to put everything on a straight-line 27.5 year schedule, and then could do a cost seg study at a later point and use 100% bonus depreciation. You can't do a cost seg, thereby accelerating depreciation, and then the next year claim 100% bonus. Doing what we call a 'lookback study' to recoup depreciation of a property that was placed in service in a previous year, does not require amending your tax returns, you only need to file a Form 3115, change of accounting method going forward.

[@alexfailaev]

@@YonahWeiss1 thank you Yonah! Good shabbos!

[@matthew1106]

Would it be worth it to hire someone to do this type of evaluation on a smaller property like a duplex (new construction)? Or is this more for larger multi-family? Thanks!

[@YonahWeiss1]

It certainly can be beneficial.

[@ruchitpatel5956]

Is the fast depreciation applicable only for a real estate professional with 1000+ hours of experience!? or even a random newbie with first property can do it?

[@YonahWeiss1]

anyone can do it, but the benefits will be limited to use against your rental income, unless you are a real estate professional.

[@ruchitpatel5956]

@@YonahWeiss1 got it, thanks.

[@ruchitpatel5956]

@@YonahWeiss1 what about capital gain income? can I use the benefits as new investor on that? Say, after few hours, I am professional, then my entire W2 income can be deducted and I pay no income tax!?

[@YonahWeiss1]

@@ruchitpatel5956 I'm not sure I fully understand your questions, but I'll share a few points that may give some clarity to the issues raised in your questions. Unless you have Real Estate Professional Status (REPS), the losses from depreciation will be limited to offset your rental income or other passive gains (like capital gains from real estate, or recapture tax) If you have REPS, then those losses are no longer limited, and can be used against any other active income you or your spouse has. If you have a W2 it is virtually impossible to also have REPS.

[@ruchitpatel5956]

@@YonahWeiss1 Yes, I wasn't clear in my question. Sorry about it. However, you answered it. I was asking two different questions. One about offsetting capital gain without having REPS, and the second question was, can W2 income be offset with that status!? I understood what you said. Love the part where gains on stocks can be offset with accelerated depreciation in real estate for newbie investors without having REPS!! Thank you.

[@mitchelldyer5415]

I hope the bonus depreciation gets extended pst 2022😢

[@ToddBizCoach]

Can a professional football player write off his cost segregation on Short Term Vacation Rentals he helped build and advised on during time he was not playing football as a RE professional?

[@YonahWeiss1]

This is going to depend on a few factors. The STRs can also be considered active income, and if he passes a material participation test, he can use the depreciation against his active income as well.

[@andylingle6646]

What’s the cost though

[@mrchatterbox2844]

You cannot treat all HVAC equipment and the lighting fixtures as 5-year personal property. Also, you can't accelerate anything in a bathroom. You can't take the bathroom vanity because if you removed it, you wouldn't have a sink anymore. I hope the engineers at Madison Spec have a little more knowledge than Yonah.

[@alexsmith8956]

Be careful. 100% bonus is only on your federal return, but many states do not conform. Thus, you can have state modifications.

[@YonahWeiss1]

Good point Alex. You can still take the accelerated cost segregation schedules in those states that have decoupled from Bonus.

[@jaytrg]

How about painting?

[@FezTheBlockchainDev]

Make sure the next president you’re voting for is going to re-instate 100% cost seg. Reward those that provide for others!

[@YonahWeiss1]

I agree with this 😊

[@iambam5576]

Everything you wanna learn you can always learn from the Jews !! Mazel Tov 🙌

[@yisroelkohn9093]

🍷🍷🍷

[@garciavashchino1]

Oh, real quick... you purchase a prop for 64mil... pssh ez btw... and could you guys freely say what the monthly income is? I ran some numbers messing around on a brand new 240mil pro after your first video with Yonah, but It made no sense. I lost money calculating. One day Ill buy a huge Multi like this, and just want to make sure Im noy losing out. Thank you guys!!

[@ChaseGilesRealtor]

Love the details in this! #Yonah2024

[@YonahWeiss1]

LOL thanks Chase!

[@JazzyByJeff]

Niiice 😎

[@CS-qc7np]

🔥

[@garciavashchino1]

Happy New Years guys!! Can CostSeg be done for Single/4xMulti? Or is there a limit to how many units before considering? IE: cost of the study vs savings overall. PS: CostSeg if I'm understanding correctly, is like a right off? So, I purchase a 250k 4 unit, CostSeg it, find out 50k in depreciation. Then what happens?? Does 50k get take. Out of something. Do I pay -50k in taxes first year, second year the difference, say I only paid 5k in taxes, 45k rolls over to the next year and 80% goes into the taxes again? Sorry guys, this is definitely to quick to digest.

[@KM-bu1js]

Hey I have a few vacant and abandoned commercial properties in my area. Was wondering if anyone would like to partner up?

[@yisroelkohn9093]

Hey in what city’s is your propertys ?

[@amunbinning8333]

.

[@KM-bu1js]

@@yisroelkohn9093 Union city, Jersey city and Newark. I don’t have them under contract yet I’m currently in contact with the owners. They are in great locations and have massive potential!!! I also have residential properties I’m trying to lock up as well from my social media marketing campaigns. I’m looking to partner up with someone who has the funds or has access to it, because I come across deals on a daily basis

[@yisroelkohn9093]

Oh wow im doing in that area I’m located in Brooklyn ny and I’m doing in nj

[@KM-bu1js]

@@yisroelkohn9093 Wow you’re in my area brother, we should connect! Maybe we can partner up on a few of these deals👍

[@crazy3rdgen]

Just another video of what cost segregation is and no concrete numbers or results from an actual case study. Unreal