Fractional Ownership
Villas
Hotels
Luxury Residences
Reduce Your Tax Liability
Increase Return To Your Partners
Improve Your Profitability
Increase Cash Flow
Fractional Ownership Cost Segregation
Cost Segregation is the IRS guide-lined method of re-classifying components and improvements of commercial and residential real estate resulting in reduced tax liability and increased cash flow. It is applicable to both owners and lessees.
A third party certified study identifies, values and separates 5, 7 and 15 year depreciable life personal property from 39 or 27.5 year, depreciable life real property (dependent on if it is commercial or residential real estate).The net result creates significant acceleration of available tax deductions. Read more about the specifics of Cost Segregation here.
How Does This Apply To Fractional Ownership?
A lot of Cost Segregation firms (or which there actually aren’t that many) don’t fully understand fractional ownership. These firms prefer to stay in their own comfort zone and undertake cost segregation on more traditional real estate and property. For them, Cost Segregation is just another Department within their overall business.
Cost Segregation is all we do. And we understand Fractional Ownership. We’ve worked out how you can apply the benefits of cost segregation to your limited partnership. You can then use your traditional K1 distribution to to provide tax offsets to your individual partners within your limited partnership. This provides a significant increase in cash flow and decreases tax liabilities for all your partners.
This unique methodology delivers tax benefits at unusually high levels while decreasing your tax liability making your partnership remarkably profitable at levels above your competition.
Get It For Free
Want this for free? We’ll pay for the study ourselves and trade you for time in your properties – it’s really that simple.
Find Out How To Apply This To Your Business Today
Summary of the Opportunity from an Industry Expert
As the Managing Director of Business Development for our well-established (20 years) Cost Segregation Study provider, I have studied the recent innovation presented to us regarding the luxury fractional ownership industry.
Having reviewed the first potential client company’s web site and information provided, using this process (cost segregation), I don’t see any reason why cost segregation wouldn’t be beneficial to both the LP’s and the GP. In light of the stated 10 year hold on the typical property in this fractional ownership partnership, the acceleration of depreciation on such a high-end vacation property should have the ability to reduce passive income for the LP’s… particularly if these properties are not highly leveraged.
As is the case when we conduct a “Certified” cost segregation study, converting 27.5 year property to lives of 5,7,and 15 years, the impact on cash flow can be dramatic. There are so many elements in a high-end vacation property that should not be included in the 27.5 year life. These are items that by there nature wear out, become obsolete and need to be replaced, or are considered personal property items. Why depreciate something over 27.5 years that by tax code only has 5, 7, or 15 year life.
By way of illustration in the pdf below, we have clearly demonstrated the significant advantages of introducing cost segregation to luxury fractional ownership partnerships. The figures represented, without identifying the actual property, are actually exact figures based upon our initial review.