Video: Expert Panel: Tax Incentives Under One Big Beautiful Bill | Duration: 2680s | Summary: Expert Panel: Tax Incentives Under One Big Beautiful Bill

Transcript for "Expert Panel: Tax Incentives Under One Big Beautiful Bill": It's starting to join in. Feel free to give us a shout out from what state you are attending. We're gonna get started in about a minute or two. We wanna let all the folks come in and wait for the attendants to pick up a little bit more so that we're all on the same page, but we'd love to hear where you're from. Hello, everyone. I'm Jennifer Bolton, head of tax at Latent USA. I'm a practicing tax attorney with over twenty five years experience. Yes. I started practicing at age five. I've been working at Leighton for five years now. Leighton's a global consulting firm that has over 3,000 employees and has helped over 50,000 clients navigate through complex tax incentives. We're very excited to have you here with us today to discuss the federal tax reform package that was recently enacted. The one big beautiful bill or as many people have heard it beside it as OBBB. This legislation delivers major changes in some of the most complex and impactful areas of tax law. And today, we're here to discuss some of those tax areas. The new tax law delivers some much anticipated technical fixers and provides some forward looking opportunities. We're gonna cover what's changed, what it means for tax planning, and what action you should consider taking now. Today, we're gonna cover four major areas, research and experimentation costs, which are now gonna be able to be fully expensed again, the employee retention tax credit limitations for certain quarterly filings, energy incentives and planning to take advantage of claiming certain benefits before they sunset, depreciation and cost segregation, the 100% depreciation bonus is back, and how we can couple that with cost segregation studies so that we can help clients obtain better tax savings. Just as a housekeeping measure, please feel free to input your questions in the chat section. We're gonna do our best to try to address one or two of them in each topic if time permits. But don't worry, if we're not able to address them all, we'll save them to the end. Before we delve into today's topics, I'd like to take a moment to allow my colleagues to each provide a brief introduction of themselves and their background. Devin, please take a moment to introduce yourself. Thank you, Jen. Hi, everyone. I'm a tax manager here at Layton on the innovation team. So we cover research and development credit, grants and funding incentives, orphan drug credit, and, specifically, I've been focusing on section one seventy four compliance for the past couple years. I've rallied for about six years, came from PwC before that, and really happy to reconnect with a lot of clients who have kind of fallen off over the past couple of years and and really excited for this the impact of this bill, especially on the r and d side. Nice to see everyone. Yeah, everyone. My name is Ben Burset, and I'm assistant team lead and senior consultant here at Leighton. Been with Leighton coming up on five years now, working on a few of our different products. Originally started on the r and d team, made the transition over to the ERC team during that heyday, and and recently came back to the innovation team where I've helped start the orphan drug, orphan drug tax credit product as well as continue our r and d efforts here. My background is in accounting, my undergraduate in accounting, my, and my MBA. I'm currently sitting for my second section of the CPA exam later this month. I'm happy to be here and look forward to providing you all with some more clarity on this on these impactful changes. And then off to Cedric now to introduce himself. James, I am a senior project manager and one of the directors for our commercial real estate business unit. Thank you for joining us. Very happy to be discussing the one big beautiful bill and how it affects our day to day lives as tax consultants and you guys as either CPAs or business owners. Kind of my background, I've been in this space for about ten years, a little over ten years now. If you see the picture, that's kind of posted right there, you'll you'll notice that I am here. That was three children ago. So exactly three kids ago was when I when I had here. But very happy. I'm also a commercial real estate owner, my or residential real estate owner myself, so I truly have a passion for all things commercial real estate, whether it's one seven ninety, 45 l, cost segregation, ITC, but happy to be of service to you guys and, shed some light on this incident today. Will, your turn. Tell them about, tell them what you do, who you are. Rick, my name is Will Whiteman. I work with Cedric on the commercial real estate team. And along those energy incentives, we off also offer cost segregation. So I I'm a engineer leading the technical effort on our cost segregation team. And, I've got about a decade of experience in cost engineering with most of that coming in cost segregation specifically. And over the years, I've helped many clients reallocate and accelerate hundreds of millions worth of dollars in the form of accelerated deductions, which which has resulted in millions of dollars in tax savings, which we're hoping to help you do so that you can, you know, grow your real estate portfolio and and business. Alright. So we're me and Ben are gonna start with the r and d credit and and more specifically, the treatment of r and d costs or research and experimental costs, which has really been what the impact of these past few years have been. So we'll start with the bad, which has really been occurring since 2022 tax year. So, basically, as most of you probably know, the Tax Cuts and Jobs Act, one of the provisions was that research and experimental or research and development costs, somewhat one and one, needs to be capitalized. There's no immediate deduction allowed. And for US based companies, that was both for US based or US, located incurred costs and foreign based costs. So you can see, you know, amortization of foreign based r and d costs for a US company, even more kind of punishing. You have to amortize those over fifteen years. And just as a note, which will also be on the next slide, that is still a provision even with this new bill. But over the past few tax years, domestic research and development costs also needed to be capitalized and amortized over five years using a midyear convention. So it's 10% amortization in year one, in year 20% in the other years instead of both deductions in the year in which those costs are incurred. So that was definitely kind of a a punishing aspect of the TCJA. Of note as well, it wasn't just quote unquote direct R and D spend like wages, supplies and materials, contractor costs. Companies also had to worry about indirect overhead R and D costs such as rent and utilities, depreciation on a building or equipment used in r and d, patents and associated legal costs, even costs to employees, like four zero one k match and other benefits, not just w two box one. So there was a lot to capitalize in conjunction with r and d activity, and that was even if a company per the bill, even if a company wasn't claiming the credit. That, of course, increased taxable income even if a company was claiming the credit in conjunction, at least in the in the short term. That was a taxable income hit. So the good part now, the OBB, the the beautiful impact of this for r and d is that it allows immediate deduction or immediate expensing of costs incurred in the year in which they're incurred going forward. So starting in 2025, companies can go back to deducting their expenses as one would and claiming the research and development credit for their qualified work. As I mentioned, the the stipulation that is kind of in line with what the whole purpose of the research credit was from the Path Act in 2015 when it was made permanent is to reward US based innovation. So foreign expenses still are subject to capitalization and still need to be amortized over that fifteen year period. But another key is that the impact of the TCJA for a lot of small businesses can be retroactively alleviated, essentially. So small businesses, this new bill defines that as average gross receipts or average sales, essentially, of 31,000,000 per year or less over the the prior three tax years. So if you meet that criteria as a company, this bill is gonna allow you to amend your returns, take r and d deductions and the r and d credit as the initial credit program was intended. So you can amend or you can accelerate remaining amortization of capitalized costs in 2025 or over two years, '25 and '26. So the big key is that going forward, the companies with domestic R and D costs don't need to worry about capitalizing them, and there is a potential retroactive relief on amended returns. You'll also see also on the next slide that that one year deadline to amend '22 through '24 to reinstitute deductions and the credit at the same time, that's that's a key. So you need to do that, by July fourth of next year. But more detail on the next slides with Ben. Yeah. Thank you, Devin. As I mentioned, you know, there there are three different ways that you really can look at, look at going back to retroactively fix, you know, what was done as far as capitalizing and amortizing these expenses. Two of which are only available for for large businesses and the third are avail is available, for small businesses as well. Number one, you can go back and retroactively amend your tax returns. So what that means is you can go back, amend those returns, get rid of that those capitalized expenses, and take those deductions in those years. On the plus side, this allows you to generate a cash refund because once that, amendment is processed, the IRS will issue you a a cash refund in hand with some added interest on top of that because of the, you know, the waiting period essentially from the overpayment in taxes in the past. A little bit of a negative on that. There is some admin burden because you do have to go back and amend that additional tax return. You have to work with your CPA or protect, preparer in that sense, possibly some additional expenses therein to go back and do that. And, of course, the the waiting period to wait for the ultimate, tax refund. Sure a lot of people here have worked with the ERC and kinda know how long some of these cash, refunds can take. So, you know, the the timetable for what that might be is a little bit ambiguous right now. So it might not be the the quickest approach here. But if you had a high tax bill in prior years, any small business, you know, under that 31, million dollars in average gross receipts, they're able to go back and retroactively fix this, and get that cash refund in hand. And then as Devin alluded to, there is that one year deadline. That is from the date of the the bill passing. So if you do wanna go back and do this, you have to amend these tax returns by July, July fourth of twenty twenty six. The other two options which are available to all tax fire filers regardless of size is either a one year or two year accelerated deduction. These are very similar in nature. Essentially what this is is you're able to do like a catch up catch up deduction, take all those capitalized and amortized expenses, neither fully deduct them in 2025 or in 2025 and 2026. This is, you know, more simple. It doesn't require you to go back and amend any returns. And allows for a large deduction in 2025 or, you know, good size deductions over two years. On a negative, there isn't a cash in hand refund. But again, because of the timing right now and the the unknown of how long this is really gonna take, you know, along with, you know, coupled with the the IRS, recently slashing half of half of their, agents, it it might actually be be quicker to go through through these means and actually accelerate on your next filings and go back. In some cases though, because of this this large deduction that's gonna be, you know, take place in '25 and '26, you might be in a net operating loss situation where you can carry that forward along with the associated, tax credit. So it really will be on a case by case situation to see what's more beneficial to you. You know, quite simply, you know, maybe if in 2025, you might not look to be profitable, so you don't need that additional deduction, it might be worth going back to to events in prior years. On the contrary, if 2025 looks to be very fruitful and you're gonna have a high tax liability, it might make sense to take that full deduction in 2025. Take that full deduction for prior years, take the r and d expense deduction from, you know, what's gonna be incurred in 2025 and able to offset a lot of that taxable, tax liabilities, that you'd be generating. So, again, it's something that we're we're happy to go over, discuss with clients, CPAs, you know, any anyone with knowledge of these situations and and really decide on a case by case situation to assist you throughout that. What this means moving forward for 2025 and onward is just going back to the the pre TCGA days. You know, you're able to fully expense your r and d r and d costs in a year in which they were incurred. You no longer really have to make the decision on how much money should I be investing versus how much money, you know, would I would I save if I if I wasn't doing r and d. With that, it's gonna just increase the strength of the section 41 of the r and d tax credit, because not only can you take that that full amortized expense or excuse me, that that full deduction in in a year, you're also able to take that tax credit right on top of it, which comes out for to a dollar for dollar offset to your tax liability. Now there still is, you know, what's called a two eighty c election, which essentially means you have to, reduce your deduction by the amount of the tax credit or reduce your, reduce your credit by the amount of, the corporate tax rate, which in effect is 21% right now. This is really the IRS is looking to avoid a double benefit or really taxing the credit, although they do call this a nontaxable credit. And lastly, it simplifies tax planning moving forward. As I alluded to earlier, you're able to just really see that the tax benefit or or dollar for dollar difference between having to amortize over those six year period that Devin alluded to and just see that, you know, tax money out is money out, and you're able to offset your income by that amount. Just simplifies it, supports cash flow, and it really gets back to, supporting, domestic innovation moving forward. So all good news on the r and d side. Still some uncertainty as far as how how these elections might need to be made or or what's the most beneficial way to go about it. But definitely good news on the r and d side. Definitely good news for for domestic innovation and, you know, happy to chat further about anything, you know, we we discussed here. Yeah. Thank you, Ben. So, yeah, I just wanna kinda summary summarize and reiterate, especially for '25 and onward. If you haven't contacted us or worked worked with us in a few years and you know your company's performing r and d, especially for this calendar year in process right now, I would definitely start, you know, thinking about what sort of the projects and activities has been and and giving us a call because going forward, it's it's very simple. You can go back to claiming the credit on an ongoing yearly basis, take your deductions as as it should have been, you know, this whole time. And if you did capitalize and claim the credit in prior years, that's also very clear. You can amend or take accelerated amortization next year like like we went over. There's a little bit of ambiguity. If companies have neither capitalized nor claimed the credit over the past few years, can they still just go ahead and amend those years and just claim the credit and take their deductions, or did they have to capitalize on the initial return? We're hoping for more guidance on that in the in the coming days or weeks. But, especially for '25 and onward, let's let's work together again, especially for those who we have in the past and and maybe haven't for a couple years. Devin, question for you. Seeing here we have, you know, a client didn't file their twenty twenty four tax return yet. Are they able to, take a 100% deduction at the time of filing the return, or or how would they go about that? Yeah. That so it's it's another thing that kinda reads weirdly on the bill, but it it definitely clearly states that the retroactive correction needs to be done on an amended return. It has to be done on an amendment. But if there's mention to that word and and that kinda language a few times within the r and d section of the bill so the real question is, you know, so it definitely has to be done on an amendment. The real question is, can you file the original term with just nothing, no r and d credit, no capitalization, then amend, take the credit and deductions, or do you need to file with capitalized costs, probably claim the credit in real time at the same time? There would be some tax due, and then you can go ahead and amend. It doesn't logistically make a ton of sense at this point for for non, timely 24 filers, you know, those who haven't filed yet that they would need to, you know, file just to amend to correct, but that is the way the bill reads pretty clearly. Jen, I don't know if you have any other input, but that's the way we're reading it currently until further guidance. Yep. We completely agree with you, Devin. We're waiting on guidance because logistically, it doesn't make sense. But we're thinking that they're trying to give relief for taxpayers who had been compliant in the past and had already been compliant up into this time. We understand that there are taxpayers who are currently on extension for 2024 and haven't filed a return, and we're hoping to be able to take the deduction. But the exact language in the statute specifically discusses to be able to take this expense, you have to amend. Let's see what happens. Hopefully, within the next few weeks or so that some IRS published guidance comes out to give us some more clarity. And I would just add real quick. The worst case scenario is you need to capitalize on '20 four's filing, take the credit, like I said, and literally 90% of that remaining deductions will be available next tax year. So that would be a four to six month waiting period if you were to file timely. That that, I would say, is the worst case scenario. I guess we'll move on then to Ben, ERC section. Sounds good. Yeah. Similar to the r on the r and d tax credit or section one seventy four side, we have seen some, changes to the employee retention tax credit. These are kind of long awaited changes. There's there's been some talks, you know, for the past couple years with with IRS moratoriums and, potential retroactive deadlines for for claiming the R and D tax the employer retention tax credit. Finally, we get some some strict guidance on this and, truthfully, could have been a lot worse than, you know, from what we were originally expecting. So first and foremost, they've they set a retroactive claim cutoff for quarter three and quarter four of twenty twenty one. They said they just established a firm date of 01/31/2024 for these two quarters. If you file the claim after January thirty first of twenty twenty four for for either quarter, we're expecting these to be disallowed moving forward. It doesn't impact anyone if you've already been paid out. You know, if you've already seen your received your refund, even if you filed after this date, they're not gonna reach out to you and and ask you to pay that money back, which creates a bit of an odd and, you know, typically unfortunate situation, because two taxpayers who are, you know, equally entitled, to the credit at the same time, you know, maybe they file even filed at the same time. They're gonna end up in two entirely different situations solely based on the IRS processing delays. So, hopefully, you know, there's some more guidance or notices on here. We expect the IRS to issue some, some type of notices to to, excuse me, any taxpayers in this situation. You gotta let them know one way or another if it's been disallowed or, you know, maybe maybe they, you know, just be the by the ballot and and get it processed right before, the the bill was passed. But we do anticipate any q three or q four twenty twenty one claims that were filed after 01/31/2024 to be disallowed. I know I saw that, you know, a question in there, related to any other, claims that haven't been paid out yet. This is only for q three and q four twenty twenty one. So anyone who's still waiting for for payments, for 2020 or the earlier part of 2021, We fully anticipate and expect that those will be paid out. Again, it's just been a long no long waiting time to until that, happens. And, unfortunately, IRS hasn't been giving too much, you know, too much information on on when that's gonna come out. But we have seen movement. We've seen progress and and hope that's gonna continue now that, firm guidance has been established. Along with that, with that cutoff date, they also extended the audit window for q three and q four. Again, this is specific just to q three and q four. But what they did is extend the audit window from three years to six years from the date either the original tax, original September, the original, payroll tax filing happened or the day of the the form nine forty one x was filed as the claim for refund on, you know, an amended, employer payroll tax return. So rather than being, you know, about three years, we just extended it six years, extended it by three more years to six years, for, again, for for 2020 or the earlier parts of 2021, that's still subjected to the the three year window. So if you've claimed on an original return or claimed, you know, maybe early twenty twenty one, you should be all good. The window for for audit has expired in in many cases since, you know, the the deadline for filing, your original return would have been in, in 2022. So both these changes are just specific to q three and q four twenty twenty one. Like I said, 2020 and earlier half of 2021 should see no impact, from anything within this bill. And then lastly, the the IRS, significantly increased scrutiny on ERC promoters and then penalties related to erroneous claims. Really what they did is just establish tougher penalties and compliance standards, for any individuals or or entities promoting ERC claims. They've they've established a definition of an ERC promoter and, essentially based off of how much income you might have received based off ERC claims or or what your line of business was. So along with, you know, along with establishing that, they included or they they increased the, assessable penalty limit. They they added a penalty for failure to comply with due diligence standards and then added some reporting requirements for ERC promoters. So, again, just some added, potential scrutiny, and and more, you know, due diligence requirements for any company that was promoting ERC. And that's really just to catch, you know, those ERC pop up shops, so to speak, or the the bad apples in the group that were really just in there to make a quick dollar rather than putting their their clients or, you know, anyone they're working with in a good position. On top of that, the IRS also amended section sixty six seventy six to include erroneous refund penalties on employment tax refunds. Previously, this was only applicable for any income tax refunds, but now they extended it to include our refunds employment taxes. So, again, just another penalty that they included. For the most part, this shouldn't, you know hopefully, doesn't impact anyone here on the call or doesn't, you know, doesn't impact any of your clients. However, you know, it is worth noting because there have been a lot of erroneous claims, you know, fraudulent claims that have been submitted. So the IRS is really trying to crack down on that, make sure that any claims that, have been paid out or will be paid out are rightfully, you know, rightfully due and eligible to to the people that hadn't had them filed. So really just, you know, the the major the major notes here is just the q three and q four twenty twenty one changes. Definitely unfortunate if you're still waiting for a payment, on that. But But if you did get it, you know, did get it filed before that 01/31/2024 deadline, this also shouldn't really apply to you except for the, extended audit window. That's really on the ERC side. Happy to take any questions at at the end here. I'll I'll take a look through the chat as well. But for now, I'll hand it over to Cedric to go over some of the energy side of things in the in the one big beautiful bill. Alright. Thank you, Ben. Bring some energy into the, energy efficiency side of things. So alright. So we're first gonna talk about, the energy efficient commercial building tax deduction, affectionately referred to as one seven nine capital d. Now a lot of those a lot of us that that are in this industry know that this was a permanent part of the tax code. And what the big beautiful build did was, drastically accelerated the the timeline for sunset. So now, if your building starts construction after 07/01/2026, so, basically, one year from now, you are no longer or it is no longer eligible to receive the one seven ninety deduction. So big change in the timeline here, but there's no other change in the mechanics. So there's no additional energy efficiency requirements. The deduction rates stay the same, so the value is still between, you know, 60¢ all the way up to almost $6 per square foot now. So the only real change was the accelerated, sunset. Now some of the nuances of what does it mean what this construction start date mean, there's they're not at they're not always cut and dry, but to speak, kinda off the cuff a little bit, There's two things that that must be met in order for you to to say that the construction has started. One of them is safe harbor. The second is, the physical work test. So safe harbor is, roughly speaking, 5% of costs incurred. Now there are some costs excluded from that calculation like design and a few other, kind of preconstruction style costs, permitting, things like that. And then the physical work test, now that's shovels in the ground, hammers on nails. Right? This is a pretty easy barrier. Now there are some, exemptions for, like, normal construction delays. Right? So, the the whole purpose of this idea for construction start date is, look, did did you did you put up a lamp post, come back three years later, and finish the job? Right? Obviously, that doesn't count as physical work test, but, you know, normal delays happen throughout throughout construction, and those those are case by case basis. So, that is kind of the exemption clause. Right? If you started construction before 07/01/2026, you could still claim $1.07 90. And as we know, most commercial buildings, or residential buildings, four stories and upright, high rise residential buildings, average construction timeline is twelve to eighteen months. So, there's still quite a lot of, of meat on the bone, so to speak, for for our 01/07/1990 folks. Now the next incident to discuss in terms of energy efficiency in commercial real estate is kind of the the sister to to one seven ninety. It's the residential, tax credit or or affectionately known as 45 l. Now the original deadline for this incentive was 2032. And, again, they have accelerated the timeline, and it is now 07/01/2026. Now there is a nuance to 45 l or or or the difference between 45 l and one seven nine d is there's no construction start date exemption for 45 l. Right? Either the building or or or the units inside of that building were sold or leased before 07/01/2026 or they weren't. So they have to be sold or leased before 07/01/2026 in order to receive the 45 l tax credit. Now good news here is that we were thinking, as an industry that they would do away with Energy Star certification or zero energy home certification. They haven't. That program is still, at the moment, intact. However, they did kind of accelerate the the the timeline here. And what that means for the build community is, if you're already building towards Energy Star standards or if you're close to Energy Star standards or zero energy home ready standards, you know, we need to make sure that those units are sold or leased before 07/01/2026 in order for you to receive the 45 l credit. K? Also, for this incentive, there is a three year lookback period. So we should really focus in whether you're a CPA on the call or you're a building owner on the call. We should really focus in on units that your clients or yourself has either sold or leased in tax year 2022 because those are still eligible, for legacy 45 l, which is up to $2,000 per unit. So hyperfocus on those. Let's make sure that we get you qualified, if you qualify. But that that those are the main changes for 45 l. Alright. Now there is a ton of movements with the investment tax credit. We've got a lot of attention. Right? This is the renewable energy tax credit. A lot of focus on this sector, and a lot of changes happens. In In fact, so many changes, it's probably too many for me to go through, today. So we are going to have another meeting, another webinar just for basically, just for this incentive and and a few other nuances for for commercial real estate. But, in general, they're really pairing back the renewable energy tax credit or the investment tax credit. There is a sunset on it for, projects placed in service after 2027, construction start date after 07/04/2026. They increased the domestic content bonus. So that's a 10% adder. They've increased that to 55% domestic content. They also put a credit recapture in place where it's a 100% recapture if the taxpayer makes certain payments to a foreign influenced entity, which we'll get into in the next slide because they also part of the America First, kind of theme to this is they wanna make sure that, we're not giving tax benefits away to foreign, foreign entities. And then lastly, it's not on this slide, but one big piece of equipment that is still in play here is geothermal heat pumps. So I wanted to bring that up. If you are a building owner who is installing geothermal heat pumps, that is excluded from that that technology is excluded from a lot of this, for for now. So, to the next slide, what we're gonna talk about is the prohibited foreign entity rule. Again, America First theme. Right? They just wanna make sure that foreign investors aren't taking, taking advantage of this investment tax credit. So they're no longer able to. Right? If they are deemed a, foreign entity, they're not allowed to take this credit. They also can't contribute materially, material assistance, to to another entity and still be able to take the credit. But, I mean, that's this incentive in a nutshell. Again, there's a ton of nuances to specific technologies and and key key, changes to specific technologies that we can get into, at a later date. But for now, instead of, the doom and gloom, we wanted to kind of, end on a good note with with cost segregation. So, Will, please. Thanks, Cedric. So, yeah, like, Cedric mentioned, along the lines of commercial real estate, wanted to finish on a high note here, really good change, really simple change, so I should be pretty quick. But they brought back 100% bonus depreciation in the one big beautiful bill. And so what does that mean? What the bill lays out is any property placed in service on or after 01/19/2025 will qualify for 100% bonus depreciation, and they actually made that permanent. So it's in all all years moving forward. And the reason this is such a big deal is because in Trump's initial term, they had taken it to a 100% bonus depreciation back in 2000 and, '17, and that went through 2022 and started phasing out 20% every year until it was gonna go back to zero. And in the current year, 2025, we were at 40%. So this is a big deal when it comes to cost segregation and personal property in general because all these shorter lived lived assets, you're able to deduct their full amount in the very first year instead of only forty, sixty, 80%. So to to better understand this, we're gonna look at a quick example. If we had a a million dollar building, placed in service this year, 2025, and we were able to segregate out 200,000 into, 15 class life land improvements and another 100,000 into five year personal property, that would give us, you know, about 30% in segregated costs or $300,000. So before the bill, you know, just a couple weeks ago at 40% bonus depreciation, we would only be able to take 80,000 of the fifteen year and 40,000 of the five year or a total of a 120,000 in bonus depreciation or a first year deduction, for you to save on taxes. But with that returning to a 100, you can take the full amount. So it would be the full 300 plus the straight line from the thirty nine year, classified that we can't touch of about $17,000. So you'd get a total deduction of $317,000 in the very first year. And to to better understand how that looks on your tax return, as far as tax savings, with 100% bonus, assuming a 30% tax rate, at 40% bonus, it would have that $300,000 deduction would have resulted in about 81,000 in tax savings. At a 100% bonus, that more than doubles and gives you a $100,000 in tax savings. So as you can see, this is a huge mover when it comes to commercial real estate because you're able to get, you know, about half your initial investment back just in the tax benefits alone in the very first year, which allows you to buy more property, reinvest into your business, and ultimately just make your dollar go farther today instead of keeping that money tied up over the next twenty, thirty years. So, that's all I've got for cost segregation bonus depreciation. I'll kick it back to Cedric to wrap us up here. Alright, guys. So before we take a few questions, just some housekeeping. We did have some great questions here, so we'll we'll get to that soon. The, one thing that I wanted to mention here is that we're going to have a follow-up session where we break out some of these incentives and go a little bit more into depth for them. So the r and d follow-up webinar is going to be Tuesday, July 15 at 12PM, And the energy efficiency and commercial real estate, follow-up meeting is going to be July 16 at 12PM eastern. Also, there are links in the chat. If you have specific questions, want to, schedule a meeting with one of us, happy to, happy to connect. But, yeah, let's take some let's take some questions now. I know there was quite a few around r and d, and I I think that we got most of those answered. But let's see. So I think, Joseph asked, how does the affected remaining tax credits from '22 and '1 for capitalized r and d costs, How does this affect remaining tax credits from 2021 for capitalized r and d costs? Yeah. So the credit itself from the TCJA's requirement to capitalize was not affected. So the the credits, they've always had a twenty year carry forward period if they're not used immediately to offset income tax due. That's either at the c corp level or the shareholder slash partner level. So with the capitalization, we would have expected credits to to still be useful and utilized most likely to offset that tax due, especially with the capitalizations impact. But if they weren't, the company was in a loss, for example, and credits are still banked carry forward, that'll remain in effect. So they would they would be carried forward until there is taxable income and thus tax to offset, like I said, either at that corporate level or the individual shareholder level. Hopefully, that addresses that question. Perfect. And, let's see. So we had some cost side questions. Those should be pretty straightforward. Let's let's knock those out. So Brian, he asked, does this apply to office and administrative space? Absolutely. We like to say is building agnostic. Doesn't matter what the building is used for. You can. If you purchased a property last year, can you use the remaining 100% this year? Will, do you get up to you? No. So it's it has to be placed in service after 01/19/2025. So anything from last year, 2023, 2024, will still have that lower bonus rate for 2024. It would be 60%. But anything from this year moving forward, we'll get that 100%. So every everything yeah. It wasn't retroactive to past tax years. It's just this year moving forward, anything in past years will, operate as it was. Perfect. And for safe harbor, yeah, for $1.07 90, we do like to look at that as a case by case basis, because there are some there's obviously some nuances. But in general, it's the 5% rule, 5% of costs incurred. Alright. Let's see. I believe, it's Gay Tomlinson. Andrew is gonna be answering your question directly regarding ITC and the start date. He's our local experts in the field. So there you go. Yep. And this recording will be shared afterwards. And, again, if you do have specific questions, it's tax. It's complicated. Right? So if you want, to speak with an expert, we're not going to, we're not going to bill you by the hour or anything like that. We can do a free consultation. Feel free to book a meeting with you guys or with with one of us. Happy to, talk through this with you guys in more depth. But I think that answers just about everybody's questions. I hope I didn't hope I didn't miss any. If a taxpayer did not file in 2024 tax return, can they claim a 100% deduction at the time of filing the return? Devin, I think we answered that, but do you just wanna follow-up with that one? Yeah. So the the first part is the bill pretty clearly states that the credit in full r and d cost deduction on '22 through '24 needs to be done on an amended return. So that's even 04/24 if it has not been filed yet. The real the real, remaining ambiguity is do you have to file that initial return with cost being capitalized, or can you just file a return as is, no credit, no capitalization, then amend to claim the credit with still full deductions? Maybe guidance is gonna come out and say, on the initial return, you have to have cost capitalized if you want to amend to claim the credit and take full deductions on '24, for example. Maybe the guidance comes out on the opposite end. Like I said earlier, the worst case scenario is essentially that that former, alternative where on the initial return, you have to capitalize r and d cost still for 24. Now the worst case scenario would be you get to accelerate the remaining 90% of amortized or capitalized costs in twenty twenty five's return. Maybe the alternative comes out better, but it is a little ambiguous for now. Yeah. Just so that I can interject a little bit more. Whenever a tax bill comes out, there's always a waiting period for revenue procedures, guidance, other issues from the IRS that become official notices or official ways in which to implement the new tax law. So we won't be surprised if they're do address certain issues such as the original filing of a 2024 tax return for research credit. So it is really kind of a let's wait and see type of deal. We can speculate, what we think could happen, but what the law states right now, as Devin has mentioned, it's clearly only applicable for an amended return to take advantage of years twenty twenty two to 2024. And this is a permanent deduction versus the house bill. If people weren't aware, when the research credit was going to be allowed to be expensed, there was a cutoff date. So this is even better. It's 2025 and forward indefinitely. Perfect, Jen. And perfect segue, we have, I think Sarah said, can we get a full explanation of of cost segregation on a separate class? Yes. Tune in. Come come to our Wednesday. Our Wednesday, we're gonna dive in. We're gonna talk about cost segregation, one seven nine d and, 45 l, and we're gonna dive really deep into ITC as well. So exciting stuff. Cross segregation, that's ROI for for building owners. And with bonus depreciation coming back to a 100%, it's it's an incredible ROI. You should definitely be exploring it if you or your friends and or cohorts own the property. Alright, guys. That pretty much sums it up. I think we've answered everybody's questions. We appreciate you guys being here. And as always, let us know if you have questions. We we are here, to serve. So with that, I think I think we're done. Thank you, everyone. Thank you. Take care.