Simple Seg Cost Segregation Company

[Account Closed]

Anyone use SimpleSeg cost segregation study? They advertise they can provide a study for under $300 in 10 minutes for residential under $500K.

I have a home on the market I’m planning to 1031 exchange. Does it make sense to do a Cost Segregation study before I sell if it costs under $500?

I get that if the study costs 5-15K it may not be worth it because of the new tax basis.

[Bill S.]

An,

If you are about to sell, doing a cost segregation study is only needed for specific tax strategy. That should be discussed with your CPA and what you are trying to accomplish. If you are rolling the proceeds into a 1031, that will only allow you to segregate the "step-up" value above the 1031 funds.

Regarding on-line models, they have benefit if no asset detail is needed. They also tend to be conservative in benefit. It's important to understand how the model works, and what your goals for a cost seg study are. Scott is right, with no asset detail they will not stand up against an IRS audit - though there are plenty of 'so called' engineering studies that will not stand up very well either. Though for lower cost properties (under $1M), where a lot of improvements aren't needed, they are quick and easy and can give the CPA 5, 7, 15 and 27.5 numbers needed to file your taxes

www.DIYcostseg.com offers a fully modeled solution for under $500 on residential (1-4) properties that is completed in minutes. It also has a $195 "Audit Protection" option, which means if you go under audit, the firm will conduct a "fully engineered study" and defend you against an audit. Its essentially an insurance policy. So you are protected. Besides residential, DIY also covers all types of commercial properties for $1,295 with an improvement basis of under $1M. Though again, it will err to the conservative. That said, plenty of properties under $1M can be fully justified to order traditionally engineered cost segregation study. It all boils down to your needs and objectives.