$1.2 million off a real estate developer's tax bill in one year

The challenge

Developers and investors often have a lot happening in the same year: properties being built, bought, held and sold. Each one has its own tax treatment, and without a plan that looks at all of them together, it's easy to pay far more than necessary.

This client was facing a large tax bill from a strong year, with properties placed in service, a sale on the horizon, and prior returns that hadn't taken full advantage of the rules.

What we did

• Reviewed the full portfolio and prior returns before the year closed, not after
• Prepared an in-house cost segregation study and applied accelerated depreciation to the reclassified components
• Structured a property sale to defer the gain instead of recognizing it all at once
• Found missed deductions and depreciation on past returns and corrected them
• Coordinated all three so each strategy supported the others on the final return

The result

Together, these strategies lowered the client's tax bill by about $1.2 million for the year. Part of that is permanent savings and part is gain deferred to a future year, but in both cases the cash stayed in the client's hands to reinvest in the portfolio.

Why it matters for developers and investors

The biggest savings rarely come from one move. They come from looking at every property, every sale and every prior return together, and planning before the year ends. That's what we do for real estate clients.