Motor Fuels Tax Minute, Episode 69: Fixed Assets and Property Taxes

In this episode of Motor Fuels Tax Minute, our hosts explored several tax-saving strategies with Ralph Ferrales and Stephen Arredondo. They also covered depreciation, green energy deductions and property tax incentives.

Key Points:

• Businesses can maximize tax deductions by using accelerated depreciation and bonus depreciation when acquiring or constructing properties.
• Section 179D energy-efficient building deduction offers businesses up to $5 per square foot for improvements in HVAC systems, lighting or building envelopes, providing substantial tax incentives for sustainable investments.
• Storing inventory and fixed assets in foreign trade zones can significantly reduce property tax liabilities and help save millions in taxes.

When acquiring or constructing property such as warehouses or office buildings, businesses can optimize deductions through accelerated depreciation. Ralph explained how shorter asset lives and bonus depreciation provide more chances to significantly reduce tax burdens.

An essential highlight of the discussion was the availability of green building deductions, leading Ralph to comment, “If you’re improving your property using modern materials, chances are that you’re going to have some energy efficiency there.”

Stephen underscored the financial relief offered by foreign trade zones, emphasizing the benefits for businesses with large sums of fixed assets or inventory. The potential for significant tax evasion can noticeably impact a company’s bottom line over numerous years.

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