Don’t File Your 2026 Taxes Until You Watch This (Cost Segregation for 2025 Buyers) with Gian Pazzia

**Russ Morgan** (0:00)
I don't know about you, but I'm not looking to reduce my monthly expenses in anything that I really care about. But when I have to spend less money, send less money to Uncle Sugar, this is like high on my priority list.

**SPEAKER_2** (0:17)
Welcome to The Wealth Without Wall Street Podcast. Your guide to understanding how to get out of the Wall Street rat race and start your own mailbox money lifestyle. Now, don't let these handsome southern girls fool you. These financial minds are teaching our country to enhance savings, increase cash flow, and create passive income, all without the help of Wall Street. Are you ready to break through? Now here are your hosts, Russ Morgan and Joey Muret.

**Joey Muré** (0:49)
Wealth Without Wall Street Tribe, so excited to introduce Mr. Gian Pazzia to the show. Gian, welcome.

**Gian Pazzia** (0:56)
Thank you, guys. Super excited to be here.

**Russ Morgan** (0:59)
Yeah. Gian, if someone bought a rental property, January the 19th, 2025, very specific date there, how much money are they potentially leaving on the table this year if they don't run a cost segregation study and why?

**Gian Pazzia** (1:14)
Yeah. No, I think what you meant to say was January 20th. It's the day after January 19th where things get good. And so the answer to that question is, they're about to have to pay tax returns or talk to their CPA, and the tax bill is likely going to be significantly higher. That's a bigger check to the government that's coming to do than if they did a cost segregation study where we can accelerate or create these paper losses from cost segregation.

**Joey Muré** (1:43)
And so you're throwing out just a general number there, John. What would you say are... Well, let me back up a second. For those who have heard this term cost segregation, but they don't really know how to say it in layman's terms, how would you explain it?

**Gian Pazzia** (1:58)
Yeah. So cost segregation really is a way for real estate investors to write off parts of their building right away. Okay. And so normally the tax code allows you to write off residential rental property, for example, over 27 and a half years. But there's a lot of things in the building that can be written off or they're classified differently. And based off of this new tax law that I think Russ was referring to, they can be written off right away. So things like the vinyl flooring in certain parts of your property, even the exterior driveways, the landscaping, things like fencing, ceiling things, those are just examples, these things inside the building that can be classified differently and written off right away. And so ultimately, we're trying to quantify all that in a Cost Segregation Study, so you can hand it to your CPA and they can claim the appropriate deduction that you're entitled to.

**Russ Morgan** (3:00)
We're also trying to hand it to Uncle Sugar as well, right? Because we want to get a little less going out the door. I mean, I'm not saying you said that.

**Joey Muré** (3:09)
I'm saying that.

**Russ Morgan** (3:11)
So you said that January 20th last year, we had some rule changes governing this. So now we can write off more in relationship to certain aspects of rental properties and other real estate that we own. But what is this? So what? The person listening wants to know, like, how much does this benefit me? So you're doing how many of these a month? Talk about some of just the aspects of why is someone actually going through this process? How do they benefit after doing it?

**Gian Pazzia** (3:42)
Yeah. So, I mean, how many of these do we do a month? We do about 500 of these a month. And really, I mean, most tax professionals that have been around long enough that are familiar with real estate are bringing this idea to their clients and telling them, you really need to do this. Because the numbers are just kind of staggering, right? It's kind of a no-brainer if you need the tax deductions and you can use them. Those are the two key qualifiers. And there's some meat behind that that we can dive into. If you can utilize these deductions, it really is a no-brainer. And why most sophisticated real estate investors, including our current president, have been using cost segregation study for 20-plus years.

**Russ Morgan** (4:31)
Well, you said if we can use them, right? I want to understand what that is. But you said that their accountants are saying, you need to do this. What is the tax deduction? How much am I able to write off? Why do I go through the hassle of this? Right? Like some people are like, I get told to do all these things, but when I look down on it, I don't really save any money. And all I'm doing is jump through a bunch of hoops. So can you speak to some actual dollars and cent type examples? And that I think would help maybe the person on the other end of this know, oh, I should keep listening because maybe this is for me.