Cost Segregation Cost segregation has always been a powerful tax strategy for real estate investors, but the next three years are especially important. Recent tax law changes now allow many investors to take advantage of 100 percent bonus depreciation again. This creates a significant opportunity for anyone who owns residential rentals, commercial buildings, or owner-occupied real estate. If you time your cost segregation studies correctly, you can accelerate years of depreciation into a single tax year, increase cash flow, reduce tax liability, and free up capital to reinvest into new properties. Below is a detailed breakdown of how to unlock bonus depreciation in 2024, 2025, and 2026 with a structured cost segregation strategy.  To explore a study for your property, visit our Cost Segregation Services page.

Key Takeaways Georgia extended the withholding election deadline from 30 days to 3 years - Businesses now have significantly more time to file This impacts the R&D credit withholding benefit - Companies can use excess credits against payroll taxes The change applies to all qualified research expenses - Manufacturing and tech companies benefit most Businesses can claim 10% credit on qualified R&D spending - Above the base amount calculation Credits can offset up to 50% of income tax liability - After all other credits applied Unused credits carry forward for 10 years - Creating long-term value for businesses Georgia businesses conducting research and development activities just gained significant flexibility. The state extended the deadline for withholding elections from 30 days to three years. This change makes it easier for companies to use R&D credits against payroll taxes. Previously, businesses had to act within 30 days after filing their returns. Why This Change Matters for Georgia Businesses The deadline extension removes a major barrier for companies. Many businesses discovered they qualified for R&D credits months after filing their returns. The old 30-day rule meant they lost valuable withholding benefits. The R&D credit provides substantial value: Credit rate of 10% - Applied to qualified research expenses above base amount Income tax offset up to 50% - After other credits are used first Payroll withholding benefits - For excess credits not used on income tax Manufacturing companies see $195,000 average credits - Based on qualifying activities The withholding election converts deferred income tax benefits into immediate cash flow. This helps startups and growing companies with limited tax liability. Companies qualify when they spend money developing new products. Activities include improving functionality and eliminating technical uncertainty. Who Benefits Most from This Change? Several types of businesses gain the most advantage from this extension: Primary beneficiaries include: Manufacturing companies - Developing new processes or products Technology firms - Creating software and improving systems Biotech companies - Conducting research and experimentation Engineering firms - Testing new designs and methods The change helps businesses that discover R&D opportunities during audits. Tax professionals often identify qualifying activities during reviews. The three-year window allows retroactive planning. This flexibility creates better cash flow management for growing companies. How the Georgia R&D Credit Works Georgia's R&D credit mirrors the federal program with state-specific benefits. Businesses calculate credits based on increased qualified research expenses. The calculation process involves: Determine base amount - Using prior three years of expenses and income Calculate current year qualified expenses - Include wages, supplies, contractors Apply 10% credit rate - To expenses exceeding base amount  File Form IT-RD - With Georgia income tax return