Cost Segregation Study
You're depreciating your building over 39 years. Components of it qualify in 5, 7, and 15.
If your business owns or has purchased commercial real estate, a cost segregation study reclassifies components of that property into shorter depreciation schedules — accelerating deductions you are already entitled to but deferring to the wrong timeline.
5–15%
Of a commercial property's value typically reclassifiable in year one
5, 7, 15
Year depreciation schedules vs. 39 years for the building
Look-back
Studies can be applied retroactively to prior-year properties
$0
Cost to determine if you qualify
Who This Is For
If your business owns commercial real estate purchased, constructed, or renovated you are almost certainly leaving depreciation on the table.
CFOs and business owners who own commercial property typically depreciate the entire building on a 39-year straight-line schedule. This is the default IRS treatment not the optimal one. A cost segregation study identifies building components that qualify for 5-, 7-, or 15-year depreciation schedules and reclassifies them, accelerating the deductions you are already entitled to.
This is not a gray area of tax law. Cost segregation is an IRS-recognized methodology documented in the IRS Cost Segregation Audit Techniques Guide the same guide the IRS uses when auditing studies. The question is not whether cost segregation works. The question is whether your CPA has done it.
Who Qualifies
Your business owns commercial or investment real estate
Property was purchased, constructed, or renovated for $500,000 or more
You have taxable income to absorb accelerated deductions (or will)
No prior cost segregation study has been performed on this property
Property Types That Qualify
If it's commercial real estate your business owns, it qualifies for a study. The property type determines the reclassification opportunity.
- Office Buildings
Tenant improvements, HVAC zones, specialized electrical
- Medical & Dental
Lab plumbing, specialty lighting, procedure room finishes
- Retail & Restaurant
Decorative fixtures, specialty flooring, display lighting
- Warehouses & Distribution
Dock equipment, specialized lighting, flooring systems
- Manufacturing Facilities
Process piping, specialty electrical, compressed air systems
- Hotels & Hospitality
FF&E, specialty plumbing, decorative elements
- Auto Dealerships
Specialty lighting, lifts, compressed air, showroom finishes
- Mixed-Use & Multifamily
Common area improvements, specialty systems
- Self-Storage Facilities
Security systems, specialty doors, lighting controls
What Businesses Get Wrong
The default depreciation schedule is not the only option. Most businesses just don't know that.
Four patterns account for most of the cost segregation opportunity that businesses leave on the table year after year
1. Depreciating everything at 39 years
2. Missing the look-back opportunity
3. Overlooking renovations and improvements
4. Timing the study wrong
The IRS default for commercial real estate is a 39-year straight-line schedule. It’s not a requirement — it’s a starting point. Most businesses accept it without knowing that components of the same building qualify for 5-, 7-, and 15-year schedules.
Cost segregation studies can be applied retroactively. A business that purchased a property five years ago and never performed a study can still capture the reclassification opportunity — without filing amended returns. Most businesses assume the window has closed. It hasn’t.
Tenant build-outs, equipment installs, and capital improvements all generate their own reclassification opportunity. Each renovation is treated as a separate property for depreciation purposes — and each is eligible for its own cost segregation study.
A study performed after year-end for the prior tax year still captures most of the value. A study performed before a property is sold can affect the tax treatment of the gain. Timing matters — and so does knowing when not to wait.
The Opportunity Cost
Every year on the default 39-year schedule is a year of accelerated depreciation you will never get back. The study is not a one-time decision it is a decision with a deadline.
Bonus depreciation rates have been stepping down since 2023. The interaction between cost segregation and bonus depreciation is where most of the first-year value lives and that interaction changes with each tax year. A study filed now reflects the rates still available.
Step 2
Specialists assess your opportunity
A cost segregation specialist reviews your property profile and prepares a preliminary opportunity estimate — the projected reclassification amount and associated deductions. This step is at no cost.
Step 1
Tell us about your property
Submit your property address, acquisition date, cost basis, and any major renovation history. The intake form takes approximately ten minutes. No financial statements or tax returns are required at this stage.
Step 3
We perform the engineering study
If you proceed, specialists conduct the full engineering analysis — component identification, cost allocation, and IRS-compliant documentation. The study typically takes two to four weeks.
Step 4
We file and defend
The completed study is delivered to your CPA for integration into your tax return. If the IRS audits the study, your specialist team provides full audit defense at no additional cost.
How It Works
From your profile to a filed cost segregation study four steps.
The process is designed to be low-friction. You provide the property information. The specialists handle the engineering, IRS filings, and audit defense.
A Differentiator Worth Knowing
Cost segregation studies create deferred tax benefit. Opscale Exchange can put a portion of that value in your hands before the IRS processes the return.
Get Started
The hesitation is almost always the same. And it consistently costs more than the study would have.
The eligibility review is at no cost. A specialist will review your property profile and provide a preliminary estimate of reclassifiable value. No financial statements or tax returns required.
Eligibility
$0 upfront. Pay nothing until your refund arrives.
There is no upfront fee for the study. Compensation is structured as a percentage of the confirmed tax benefit — agreed at intake and fixed before the study begins. If there is no benefit, there is no fee.