Our expert cost segregation services help property owners and real estate investors accelerate depreciation, maximize tax deductions, and increase cash flow while minimizing the risk of IRS audits.
Most real estate investors miss out on tens or hundreds of thousands in tax deductions simply because their CPA is depreciating their property too slowly. If you’ve purchased or improved real estate in the last 15 years and haven’t done a Cost Segregation study, you’re almost certainly overpaying in taxes. We help you reclassify, recover missed depreciation with Form 3115, and apply Bonus Depreciation where it matters most.
Effective tax planning is crucial for maximizing your financial success. One of the most powerful tools in our arsenal is Cost Segregation, a strategic tax planning strategy that can significantly enhance your tax savings and improve cash flow. The Cost Segregation process involves the detailed engineering-based analysis of a property to identify real-estate property or building components that will generate accelerated depreciation deductions and federal tax deferrals.
The goal of the analysis is to segregates assets into distinct class categories including personal property, land improvements, and structural components and then reclassifies parts of a property into shorter depreciation categories. Instead of depreciating the building over 27.5 years (residential) or 39 years (commercial), you can accelerate depreciation of components like lighting, flooring, and HVAC over 5, 7, or 15 years. That means you claim more deductions today, not decades from now, boosting cash flow and reducing tax liability immediately allowing for substantial tax savings in the early years of ownership.
The best time to conduct a Cost Segregation study is immediately after construction, purchase, following renovations, or major improvements. You may also do one retroactively on properties placed in service in prior years with “catch-up” depreciation through a Form 3115 without amending tax returns. There is no statute of limitations on when a Cost Segregation study can be performed to claim missed deductions! Understanding the tax implications of your property investments can help you make more informed financial decisions and optimize your overall tax strategy.
What are the Savings
→ Bonus Depreciation
Here are some of the typical savings off depreciable basis by property type:
18-90% = Self-Storage Facilities
18-40% = Manufacturing
20-30% = Warehouse, Research Facility
20-40% = Apartment Building, Medical Office, Mobile Home
Parks, Office Building, Retail Strip Mall
20-45% = Grocery Store
22-35% = Mixed Use
22-45% = Hotel & Resorts, Restaurant, Vacation Rentals, Assisted Living Facility, Hospital, Fitness Center
28-60% = Golf Course
29-35% = Auto-Car Dealership
30-68% = Theme Park
50-100% = Gas Stations
75-100% = Car Washes
Client Snapshot
→ $1.12M additional 1st year deprecation
→ $291K additional 1st year deprecation
→ $576k additional 1st year deprecation
When you conduct a Cost Segregation study, we break down your building into faster-depreciating asset classes like electrical, HVAC, flooring, and more. Under the OBBBA, 100% Bonus Depreciation was restored and made permanent for qualified property acquired after January 19, 2025 and placed in service after that date.
A $3 million commercial property might yield $800,000–$1,200,000 in accelerated deductions in year one alone drastically lowering your taxable income.
"But won't the IRS flag this?"
No, Cost Segregation is IRS-approved, and we work with engineers who follow the official IRS audit guidelines. We provide audit-ready documentation to your CPA, and Specialty Tax Advisors provide support on your study in the unfortunate event that an IRS Audit occurs.
When it comes to maximizing your tax savings and accelerating depreciation, Specialty Tax Advisors is your trusted partner for cost segregation services. Here’s why real estate investors and property owners choose us to optimize their tax strategy:
With over 130 years of combined industry experience, we leverage our deep tax expertise and engineering-based cost segregation knowledge to help you maximize depreciation and boost your cash flow. Our team knows how to navigate the complexities of tax laws, ensuring you take full advantage of all available deductions and tax benefits.
We offer a free benefit analysis to evaluate the potential savings before you commit. With no upfront costs, you can explore the tax advantages of cost segregation without financial risk, making it a no-brainer for property owners looking to unlock significant tax deductions.
At Specialty Tax Advisors, we work closely with your CPA and financial team to integrate cost segregation into your overall tax strategy. This collaboration ensures that all aspects of your tax plan are aligned and optimized for maximum savings.
Specialty Tax Advisors has completed over 10,000 cost segregation studies, saving clients over $1 billion in tax benefits. Our comprehensive studies are designed to deliver the maximum possible tax savings, utilizing IRS-approved methods that have withstood audits nationwide.
We provide IRS-defensible documentation, ensuring that your cost segregation study is compliant with IRS guidelines. Our detailed reports are designed to withstand IRS scrutiny, giving you peace of mind and protecting you during any potential audits.
In addition to cost segregation, we provide a wide range of tax incentives, including Bonus Depreciation, energy-efficient property incentives, and Form 3115 to recover missed depreciation from prior years. Our services go beyond just cost segregation to ensure you get the most out of your tax opportunities.
A cost segregation study identifies components of your commercial property that qualify for accelerated depreciation, allowing you to maximize tax savings by breaking down the property into shorter depreciation schedules, resulting in increased cash flow and tax breaks.
The engineering-based cost segregation analysis involves a thorough evaluation of your commercial or residential real estate, breaking down the property into its individual components (land, building, and personal property) to maximize depreciation and identify potential tax savings opportunities.
A reputable cost segregation company will perform a cost segregation study to identify eligible assets that can be depreciated over a shorter time frame, helping you qualify for accelerated depreciation and significant tax savings on commercial or residential properties.
Both commercial and residential real estate can benefit from cost segregation. This includes shopping centers, office buildings, and even residential rental properties, allowing property owners to maximize depreciation and enjoy additional tax incentives.
By conducting a thorough analysis, cost segregation firms help business owners and property owners qualify for bonus depreciation, which allows for larger deductions in the earlier years of ownership. This can lead to a higher return on investment and substantial tax savings.
A well-documented and detailed cost segregation analysis can provide IRS audit protection by ensuring your property’s depreciation schedules and tax deductions are compliant with federal and state tax laws, reducing the risk of challenges during an audit.
No, Cost Segregation is IRS-approved and we work with engineers who follow the official IRS audit guidelines. We provide audit-ready documentation to your CPA, and Specialty Tax Advisors provide support on your study in the unfortunate event that an IRS Audit occurs.