In this episode, host Toby Mathis, Esq., speaks with returning guest Chris Streit, a cost segregation expert from CSA Partners, about two frequently overlooked tax strategies that can save real estate investors thousands of dollars: Partial Asset Dispositions (PAD) and Qualified Improvement Property (QIP). They discuss how PAD allows investors to immediately expense the remaining value of replaced building components like roofs, rather than continuing to depreciate both the old and new assets simultaneously. Chris explains how QIP enables investors to leverage 100% bonus depreciation on commercial property improvements made after January 19, 2025, including improvements to short-term rentals.
The conversation covers the critical timing of converting long-term rentals to short-term rentals before making improvements, the necessity of cost segregation studies for substantiating these deductions, and real-world applications for various commercial properties including hotels, restaurants, and retail spaces. Toby and Chris also address common concerns about IRS audits and emphasize the importance of working with specialized professionals to maximize these often-missed deductions.

Highlights/Topics:

(00:00) Understanding partial asset dispositions and roof replacements
(07:11) Qualified improvement property explained for commercial assets
(11:18) Converting long-term rentals to short-term
(18:31) Bonus depreciation timeline and audit concerns
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Resources:

📊 Cost Segregation Resources: Request a FREE Cost Segregation Benefit Analysis: https://aba.link/83c5ab Learn more about CSA Partners: https://csap.com/

🎥 Related Videos With Chris Streit:
5 Cost Segregation Mistakes That Trigger IRS Audits: https://youtu.be/1urK1954GS8
Stop Overpaying Depreciation Recapture: The §1245 Move They Skip: https://youtu.be/DBbT2jVG3Js

📚 Download Your Free Resources: Download Your Digital Copy Of Infinity Investing: How The Rich Get Richer And How You Can Do The Same: https://inf.link/efz
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