What components are reclassified in a cost segregation study?

Personal property (carpeting, fixtures, decorative elements): 5-year MACRS. Land improvements (parking lots, landscaping, fencing): 15-year MACRS. Structural components remain 39-year (commercial) or 27.5-year (residential rental).

What is the typical ROI of a cost segregation study?

For a $2M commercial property, a study typically costs $8,000–$15,000 and generates $100,000–$300,000 in accelerated first-year deductions. At a 35% effective rate, that is $35,000–$105,000 in tax savings year one.

Does cost segregation trigger depreciation recapture on sale?

Yes. Sections 1245 (personal property) and 1250 (real property) recapture apply on sale. Accelerated depreciation is taxed at ordinary rates (25% for Section 1250, up to 37% for Section 1245) on gains attributable to prior depreciation.

Cost Segregation Allocation Calculator

Estimate tax savings from cost segregation study on commercial or residential rental property. Reclassifies components from 39/27.5-year to 5/7/15-year MACRS, accelerating depreciation deductions.

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Frequently Asked Questions

What components are reclassified in a cost segregation study?

What is the typical ROI of a cost segregation study?

Does cost segregation trigger depreciation recapture on sale?