AE Tax Advisors

I purchased a 200-unit self-storage facility in Memphis. My old accountant treated it like a simple building -- one asset, one depreciation schedule, 39 years. AE Tax Advisors showed me how much money that simplistic approach was costing me.

They performed a cost segregation study that broke the property into dozens of individual components. Storage unit partitions, roll-up doors, gate access systems, security cameras, fencing, perimeter lighting, paving, drainage systems, landscaping, and the climate control systems in the interior units were all reclassified into 5, 7, or 15-year depreciation categories.

The amount of reclassifiable property in a storage facility is surprisingly high because so much of the value is in the components rather than the structure itself. AE Tax's engineering team spent a full day at the facility documenting every component, taking measurements, and assigning proper asset classifications.

With bonus depreciation applied to the reclassified assets, the first-year tax savings came to $82,000. That is an incredible return on the cost of the study.

What I appreciated about working with AE Tax was their knowledge of self-storage specifically. They understood the difference between climate-controlled and non-climate units, how to classify the office and retail space separately, and how to handle the manager's apartment that is part of the facility. They did not need me to educate them on the business.

Self-storage is one of the best asset classes for cost segregation because of the high ratio of personal property to structural property. If you own a storage facility and have not done a cost seg study, AE Tax Advisors will show you what you are missing.