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Home » Services » Cost Segregation » When and how often should I do a study?

Should you do a cost segregation study before or after a construction rehab? Do it before any improvements.

Because cost segregation sets a baseline for the original purchase, it’s easier for us and the IRS to set that baseline by performing the study before the rehab, with an engineer documenting the reclassification, before the improvements are made. It’s harder to document your rehab costs after you’ve renovated.

After the rehab, you’ll have receipts and invoices that tell us the exact cost of the new items. With your cost seg report pre-rehab and receipts/invoices to justify the cost of anything new and details on what was replaced, you’ll have everything you need to apply bonus depreciation/partial disposition elections/repair rules. If you go ahead with the improvements, you can revert back to the original cost seg studies and calculate your partial asset disposition.

If you go ahead with your cost seg study, we will:

  • classify or reclassify each building component into the appropriate tax life as prescribed by IRS guidelines and identify
  • allocate indirect costs to each asset, and
  • complete a written report with the asset details supporting the reclassifications and completion of the necessary tax form(s).

In other words, after you commission your study, you can leave the driving to us. We’ll handle all the details and work with you to get the most advantageous tax break. We’re experts at cost segregation; we’ve completed over 30,000 studies in the last 20 years.

Our clients save an average of $200,000 by commissioning a cost seg study with us. You may be able to recoup more. Please contact us and see how much in tax savings we could possibly deliver to your door.

Case Studies Cost Segregation

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Cost Segregation study on a $2.6 Million Apartment Building in Jenks, OK

Without a Cost Segregation study, a $2.6 Million Apartment Building in Jenks, OK, purchased in 2019 would have generated a 1st year depreciation of $38,888.89. …

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Cost Segregation study on a $392,000 Apartment Building in Hillsborough, NH

Without a Cost Segregation study, a $392,000 Apartment Building in Hillsborough, NH, purchased in 2019 would have generated a 1st year depreciation of $8,469.14. By …

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Cost Segregation study on a $983,000 Apartment Building in Concord, NH

Without a Cost Segregation study, a $983,000 Apartment Building in Concord, NH, purchased in 2019 would have generated a 1st year depreciation of $21,237.66. By …

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