Cost
Segregation

A Cost Segregation Study is a powerful tax strategy to boost cash flow and reduce tax liability. It works by reclassifying components of a property to accelerate depreciation. These studies can be conducted on new construction, renovations, expansions, or recently acquired properties.

 

By identifying and reclassifying building components into shorter-lived asset categories, property owners can defer taxes and claim larger depreciation deductions much earlier. Instead of depreciating an entire property over the standard 39-year timeline, eligible components can be depreciated over 5, 7, or 15 years—and those with a tax life of 15 years or less may qualify for immediate bonus depreciation, significantly increasing current-year cash flow.

 

While cost segregation studies deliver the greatest benefit when performed early—ideally within the first year of purchase or construction—Taxster’s efficient and flexible process allows property owners to realize these benefits even years after acquisition or completion.