Cost segregation is a timing tool, not a magic trick
It does not create new deductions. It pulls part of the depreciation forward so the tax benefit shows up sooner.
What it is
A cost segregation study breaks part of a property into shorter lives, often five, seven, or fifteen years, instead of leaving everything on the long building schedule. That can move a large share of depreciation into year one.
When it may fit
It usually matters most when the building basis is large enough, the taxpayer is in a high bracket, and the hold period is not too short. If the property is small or the hold is short, the fee and the later recapture may not be worth it.
What I do
I help screen the asset before you close, pressure-test the hold story, and make sure the engineer and CPA get a clean deal file.
Educational only, not tax advice. Your CPA must confirm tax treatment, timing, participation, basis, and filing before you act.
Common questions
Can I do the study years later?
Sometimes. A look-back study may still be possible. It is still better to plan the asset and the records early.
Does every rental need this?
No. A good study on the wrong property is still the wrong deal. We screen the property before we treat the study as a solution.
Who signs off on the tax result?
Your CPA does. I help you buy and prepare the right file. Your CPA decides how it lands on the return.
Want to know if a target property is even worth studying?
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Real Estate Review
Book a Real Estate Review with Aditya Kasturi to discuss your real estate goals, property options, and questions for your trusted advisors.
View guide ->Cost Segregation Planning Before You Close
Cost segregation planning: when it may fit, what it involves, and how to time the study before tax season.
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