Cost Segregation Depreciation (Before & After)

Cost segregation can be tricky - we know! To quickly sum it up, Cost Segregation is all about accelerating depreciation at a much faster rate than the usual straight-line depreciation of 27.5 years (residential) or 39.5 years (non-residential). When it comes to crunching the numbers and getting into the nitty gritty, thinking of the "bigger picture" can be tough. To make things easier, we put together a visual of Cost Segregation Depreciation (Before & After). 

Now as a tax payer, you may want to know what's in it for me? If you've ever wondered how cost segregation can benefit me?, we've got two words - tax savings. Everyone loves to save money on their taxes, right? If you do then I suggest you keep reading. 

For a more detailed explanation on how Cost Segregation works check out the blog post:

How Cost Segregation Works

To put things into the "bigger picture" we've put together the below visual that provides a high-level summary of the before and after look at how cost segregation can provide tax savings. 

The below visual showcases "Joe the Investor" and his single family residence investment property. When looking at the comparison keep in mind that depreciation is considered as a "paper loss." Therefore with cost segregation, Joe the Investor realized additional depreciation that he otherwise wouldn't have received if he utilized straight-line depreciation over 27.5 years. Plus, who wants to wait that long anyways?

*red numbers represent a loss


Cost Seg Before and After

Ready to see how cost segregation could help you? It all starts with running a FREE benefit estimate. We ask you a few simple questions such as type of building, purchase price and year purchased, just to name a few.