"Accruit offers the most efficient and complete solution for deferring taxes on the sale our capitalized rental fleet. We run a very lean operation so Accruit's full-service offering fits right in with our eye on the bottom line.”

CFO, JW Burress

1031 Exchange Case Studies

Have a look at some of our like-kind exchange success stories. Accruit has been fortunate to work with some of the finest businesses in America, and we're proud of our track record of helping them find the cash they needed to grow their businesses. Have a look, and contact us if you'd like to talk about becoming our next success story.

Case Study – Single Exchange: Janssen Brothers Engineering and Construction

January 17th, 2012

1Janssen Brothers Engineering and Construction (JBEC) is a large, top-rated contracting firm based in the Midwest. They routinely buy and sell a variety of heavy equipment in the course of business. THE PROBLEM In 2009 JBEC decided to move several older cranes and to purchase a new model from a local dealership. The existing cranes were fully depreciated for tax purposes, and the company anticipated a hefty tax bill upon sale. THE ACCRUIT SOLUTION JBEC, which had conducted several single exchanges in the past, consulted with its Accruit Client Service Manager and learned that its plans ... (Read the rest of this entry)

Case Study (Complex Single Exchange): Hartson Oil

March 2nd, 2010

pipe1Hartson Oil is an independent energy firm focused on the exploration, development, acquisition and production of domestic natural gas and crude oil. Like most companies in this industry, Hartson routinely buys and sells a variety of corporate assets, including real estate and tangible assets (vehicles, drilling and production equipment, piping and casing). THE PROBLEM Hartson faced a complex exchange scenario. The company planned to purchase multiple strings of tubing and casing over a period of several months and they intended to sell scrap tubing and casing sometime between the first set of purchases and ... (Read the rest of this entry)

Case Study: American Value Automotive

February 9th, 2010

carsAccruit 1031 like-kind exchanges drive multi-million dollar benefit for major auto rental licensee... American Value Automotive* (AVA) is a large licensee serving the western United States. Their portfolio includes light trucks and automobiles (cars comprise roughly 95% of their assets). The Problem AVA sells 3,000 vehicles per year, generating $72MM in revenue. The assets have a five-year MACRS life, but the average hold time is just six months. The company’s combined state and federal tax rate is approximately 40%. The Accruit Solution Accruit developed a powerful repetitive program for the company that keeps track of depreciation, ... (Read the rest of this entry)

Oil & Gas: 1031 exchange program generates massive cash flow and asset management benefit for energy industry giant IconX

October 16th, 2009

derricksunwideIconX Energy* is one of the world's largest energy companies, providing customers around the globe with fuel for their automobiles, electricity for their homes and a wide range of petrochemical products for every phase of their lives. As with any large enterprise, IconX is constantly buying and selling large quantities of assets, and in the process, dealing with the complex tax implications of these activities. The Problem IconX had historically employed 1031 like-kind exchanges (LKEs) for real estate and leasehold transactions, but several years ago company executives learned that LKEs could also be ... (Read the rest of this entry)

Case Study: 1031 Exchanges and Vintage Motorcars

July 17th, 2009

duesenberg- Classic cash strategy helps vintage automobile collectors keep $500,000 in the family... The Situation Since his retirement from professional racing, Joe Croydon and his wife Marilynn* have been avid collectors and restorers of vintage Grand Prix motorcars (including several classic models from Maserati, Lotus and Tyrrell). As they became more deeply involved in this hobby, the Croydons amassed a premier collection of superbly restored vintage Formula 1 and pre-F1 cars. In watching the auto collector's market, they recognized some unique and attractive investment opportunities. As is common with vintage car collectors, they ... (Read the rest of this entry)

Case Study: Blue Jay Energy

June 25th, 2009

derricksunThe Situation Blue Jay Energy (BJE) focuses on the exploration, development and production of natural gas and crude oil in several regions of the United States. The company currently has proved reserves in excess of one billion cubic feet of gas equivalent and a reserve-to-production ratio of over 10 years. The Problem As is common with energy exploration businesses, Blue Jay’s holdings include some underperforming fields. It recently decided to divest an oil and gas leasehold with tangible field machinery and equipment so that it could reinvest in properties it expected would generate greater yields. ... (Read the rest of this entry)

Case Study: Silver State Equipment

May 29th, 2009

Silver State Equipment* (SSE) has, as its primary lines of business, the rental and sale of heavy equipment. With several local branches across Nevada, SSE has been especially successful renting equipment to both commercial and residential builders. Given the high usage rates associated with their rented equipment, they typically upgrade their equipment every three years. Silver State considered multiple cash and asset management strategies, including LKEs and Bonus Depreciation. The results associated with one of their most common transactions, the sale and repurchase of a track dozer for their rental fleet, illustrates the value of a 1031 exchange program. Scenario 1: LKE ... (Read the rest of this entry)

Automotive Scenarios Case Study

May 29th, 2009

CASE STUDIES: Automotive Scenarios To get a real feel for the financial impact of a Like-Kind Exchange (LKE) program, it is best to review the 5-year cash flow benefit for certain volume levels. Every business is unique so each implementation of an LKE program is slightly different; however, these examples should provide a general understanding of the benefits. Scenario 1: 100 Cars Sold per Yearautomotive1 ASSUMPTIONS: Annual Rental Car Sales: $1,800,000 • Tax Life: 5 Years • Average Age at Sale: 1 Year • Income Tax Rate: 35% • Exp. Annual Growth: 5% • Exp. Annual Inflation: 2% 5-Yr Bottom-Line Benefit: ... (Read the rest of this entry)

Trucking Industry Case Study

May 29th, 2009

Case Studies: Trucking Scenarios To get a real feel for the financial impact of a Like-Kind Exchange (LKE) program, it is best to review the 5-year cash flow benefit for certain volume levels. Every business is unique so each implementation of an LKE program is slightly different; however, these examples should provide a general understanding of the benefits. Scenario 1: 72 Tractors Sold per Yeartruckingindustry1 ASSUMPTIONS • Annual Tractor Sales: $1,800,000 • Tax Life: 3 Years • Average Age at Sale: 5 Years • Income Tax Rate: 40% • Exp. Annual Growth: 5% • Exp. Annual Inflation: 2% 5-Yr Bottom-Line Benefit: ... (Read the rest of this entry)

Small Equipment Industry Case Study

May 29th, 2009

smallequipment1Case Study: Equipment Dealer Recognizes $2.5M Increase in Cash Flow with a Like-Kind Exchange Program Primary Concern In the years 2002 through 2004 the client took advantage of Bonus Depreciation. This created additional cash flow for those years but the expiration of Bonus in January 2005 meant the client would soon have to pay that benefit back. Challenge The client's financial department and tax advisor were challenged by leadership to uncover a method to mitigate or even delay the pending cash drain anticipated upon the expiration of bonus depreciation. The company had realized a significant ... (Read the rest of this entry)

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