Cost Segregation
Unlock Hidden Tax Savings & Increase Cash Flow
Accelerate Tax & Business Services provides engineering-based cost segregation studies designed to identify assets that may qualify for shorter recovery periods, accelerate depreciation deductions, and support audit-ready tax reporting.
Estimate your savings in minutes — use our interactive calculator to see your potential tax benefits.
30+
Years of Experience
10,000+
Studies Delivered
$1B+
Documented Tax Savings
100%
Audit-Free Record
Understanding Cost Segregation
A cost segregation study is an IRS-recognized tax strategy that identifies assets that may qualify as personal property or land improvements for federal depreciation purposes. Instead of depreciating your entire building over 27.5 or 39 years, certain components can be depreciated much faster.
Through detailed engineering and cost analysis, qualifying assets are identified and assigned shorter recovery periods under federal tax guidelines.
These include non-structural building components (specialty electrical, flooring, millwork, and decorative finishes), exterior site improvements (parking lots, landscaping, signage), and certain dedicated systems that may qualify for 5-, 7-, or 15-year recovery periods, depending on the facts and circumstances.
Primary Benefits
Accelerated Depreciation Strategy
The primary goal of a cost segregation study is to identify construction-related costs that can be depreciated over shorter recovery periods — generating accelerated deductions, larger early-year benefits, and freeing up cash for reinvestment and growth.
Benefit 01
Accelerated Depreciation
Reclassify assets into shorter recovery periods (5, 7, or 15 years) to maximize early-year deductions and reduce current tax liability.
Benefit 02
Improved Cash Flow
Reduce current tax obligations and free up capital for operational needs, expansion initiatives, or strategic investments.
Benefit 03
Retroactive Application
A cost segregation study can be applied to properties placed in service in prior years to capture missed depreciation using an IRS-approved §481(a) catch-up adjustment—without amending prior returns.
Beyond Tax Savings
Additional Benefits
The asset-level detail developed during a study can also support related planning efforts, including fixed asset review, insurance documentation, and property tax discussions.
- Detailed asset-level documentation for fixed asset records
- Supporting data for insurance coverage discussions
- Information that may assist with property tax appeals in some jurisdictions
- Comprehensive records for future due diligence or disposition planning
By The Numbers
Typical Results From Cost Segregation
Cost segregation consistently identifies material reclassification opportunities across property types. The following represent general benchmarks — actual outcomes vary by asset mix and acquisition timing.
25–35%
On average, 25%–35% of total property cost is reclassified into 5, 7, or 15-year depreciation categories.
$2M+
A $2M property may generate substantial first-year depreciation deductions depending on asset mix, placed-in-service date, and depreciation assumptions.
Year 1
Benefits are realized immediately — accelerated deductions reduce your current-year tax liability.
Results vary based on property type, acquisition date, and construction details. Contact us for a personalized estimate.
Industry Applications
Property Types We Serve
Cost segregation delivers significant benefits across a wide range of commercial and residential property types.
Multi-Family Apartments
Typically 30%+ reclassification potential
Office Buildings
Strong results for tenant improvements
Retail & Shopping Centers
High fixture and site improvement content
Hospitality & Hotels
Often 35%+ due to FF&E and finishes
Medical & Dental Offices
Specialized equipment qualifies
Industrial & Warehouse
Site improvements often overlooked
Our Methodology
The Process
A disciplined, engineering-based workflow designed to identify qualifying assets and deliver audit-ready documentation.
1
Document Review
Analyze construction costs, architectural drawings, invoices, and fixed asset records to establish the scope of the study.
2
Site Inspection
Conduct a comprehensive property walkthrough to identify qualifying assets and document components that support shorter recovery periods.
3
Asset Reclassification
Assets are analyzed and classified into the appropriate MACRS recovery periods (5, 7, or 15 years) based on IRS guidance and engineering-based cost analysis.
4
Engineering-Based, Audit-Ready Report
Deliver comprehensive documentation, including an Executive Summary and Form 3115 when applicable, designed to support the position and coordinate with your CPA.
Eligibility
Who a Study Is Best Suited For
A cost segregation study is most effective for properties valued above $200,000 and placed in service after 1986.
Residential & Commercial Properties
New Construction & Major Renovations
Property Acquisitions & Expansions
Older Properties with IRS Catch-Up Adjustments
Getting Started
How to Proceed
A straightforward path from initial inquiry to final, audit-ready report — coordinated with your existing tax team.
1
Fill Out Our Estimate Form
Complete our Cost Segregation Estimate Form with basic property details. We use this information to provide an initial assessment of potential benefits.
2
Schedule a Consultation
Begin with a complimentary consultation. We review your property type, project scope, and financial objectives to confirm eligibility and potential benefits.
3
Provide Documentation
Submit available construction costs, architectural drawings, or fixed asset schedules. Even limited records can be used to build a compliant analysis.
4
On-Site Review
Our specialists walk the property (or use digital documentation when appropriate) to identify qualifying assets, improvements, and overlooked deduction opportunities.
5
Deliver Final Report
You receive an engineering-based, audit-ready report with complete asset reclassifications, depreciation schedules, and IRS documentation for seamless filing.
Why Choose Us
Engineering-Based, Audit-Ready Studies
Every engagement pairs specialized technical work with coordination through your existing tax team.
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Engineering-Based Studies
Our studies are prepared by specialized cost segregation professionals and reviewed in coordination with your CPA or tax advisor for technical accuracy.
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Audit-Ready Documentation
We provide comprehensive documentation that meets IRS requirements and supports your filing, including Form 3115 preparation when applicable.
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Works With Your CPA
Keep your existing accountant — we collaborate seamlessly with your tax team and provide all necessary supporting schedules.
Real Results
Case Study
Multi-Family Apartment Complex
Dallas, TX
Property: 150-unit apartment complex acquired in 2019
Purchase Price: $18.5 million
Reclassification: Approximately 27% of depreciable basis identified as assets with shorter recovery periods
$2.5M
Assets Reclassified
$420K
Est. First-Year Depreciation Increase
The study identified substantial first-year depreciation benefits, and the documentation gave our CPA the support needed for filing.
Results will vary based on asset mix, acquisition date, depreciation assumptions, and taxpayer circumstances.
Ready to see whether your property qualifies for accelerated depreciation?
Schedule a complimentary assessment to estimate potential reclassification opportunities and determine whether a cost segregation study makes sense for your property. Engineering-based, audit-ready reports.