What is it?

A cost segregation study is the process of identifying personal property assets that most  often get buried or lumped together within the real property asset. Our engineers reclassify those assets based on IRS guidelines to the shortest possible depreciable life to help the real estate owner to maximize their tax depreciation, thus reducing current income tax obligations. Approximately 95% of all commercial real estate is depreciated over 39 years. A cost segregation study identifies 10-50% or more (depending on the industry) of assets that may qualify and be depreciated over a 5-, 7-, or 15-year life. The result is an increase in depreciation expense which reduces taxable income therefore increasing cash flow.