Tax Mitigation
Cost Segregation
Accelerate depreciation to unlock near-term deductions.
A cost-segregation study reclassifies parts of a building into shorter depreciation schedules, front-loading deductions and improving cash flow.
How it works
An engineering-based study identifies building components, fixtures, flooring, landscaping, that can be depreciated over 5, 7, or 15 years instead of 27.5 or 39, accelerating deductions into the early years of ownership.
Benefits & considerations
Potential benefits
- Larger deductions in the early years
- Improved cash flow to reinvest
- Can pair with bonus-depreciation rules
- Applies to purchased, built, or renovated property
Considerations
- Requires a qualified cost-segregation study
- Depreciation recapture may apply on sale
- Best value on higher-basis properties
Who it is for
Owners of commercial or investment real estate looking to boost near-term deductions.
Explore Cost Segregation for your situation
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