R.E. Cost Seg options begin at $500 for the software tier and $950 for a Rapid Report. Fully engineered studies begin at $2,320 for residential property and $2,730 for commercial property. Across the wider industry, $3,000–$15,000+ is the broad benchmark for engineering-based studies. Residential and smaller commercial studies generally cost about $2,500–$7,500, while larger or more complex properties may cost $10,000–$25,000 or more.

In real estate, a cost segregation study is an engineering-based analysis that separates a building into its individual components — flooring, cabinetry, electrical, plumbing, parking, landscaping — and assigns each to the shortest IRS-allowed depreciation life (5, 7, or 15 years) instead of the default 27.5 or 39 years. Real estate investors use it to accelerate depreciation deductions and reduce taxable income in the early years of ownership.

Cost segregation studies are performed by specialized firms with engineering and tax expertise, not by typical CPAs. The IRS Audit Techniques Guide calls for engineering-based methodology, so a credible provider employs qualified engineers who inspect the property, classify assets, and produce audit-defensible documentation. Your CPA then uses the finished report to file the deductions. R.E. Cost Seg performs fully engineered studies for investors in all 50 states.

Yes, for most building purchases. Bonus depreciation under IRC Section 168(k) applies to qualifying property with a recovery period of 20 years or less. Items already identified separately, such as furniture or equipment bought on their own, can qualify without a study, but most of a building's short-life value is built into its components. A cost seg study identifies and reclassifies those components into shorter recovery periods and gives your CPA the engineering-based documentation to support the accelerated deductions.

A full cost segregation report runs 30–100+ pages. It includes an asset-by-asset breakdown of every reclassified component, depreciation schedules by recovery period, the engineering methodology, and IRS compliance documentation. Your CPA uses this report to file your depreciation deductions.

Cost segregation study software varies by firm, but most use proprietary engineering platforms combined with industry-standard cost estimating tools like RSMeans data and Marshall & Swift. These systems help engineers assign accurate replacement costs to individual building components and map them to the correct IRS asset classes. The software matters less than the engineering methodology behind it; a credible firm follows the IRS Audit Technique Guide regardless of the tools used.

No. A standard depreciation analysis assigns the entire building (minus land) to one recovery period, 27.5 or 39 years. A cost segregation study goes further. It breaks the property into individual components and assigns each to the shortest defensible recovery period based on engineering analysis and IRS guidelines.

Yes, but you don't need to limit your search to local firms. Cost segregation is a specialized engineering discipline, and the best firms work with investors nationwide. R.E. Cost Seg serves clients in all 50 states. Property inspections can be conducted through virtual site visits, so geography is rarely a limiting factor. What matters most is the firm's engineering expertise, IRS compliance track record, and turnaround time, not proximity.

It depends on the type of study. A Rapid Report usually takes about 5–10 business days once you've paid and completed the online questionnaire. A fully engineered study typically takes about 15–20 business days (roughly 3–4 weeks) once you've submitted all required documents and completed the site inspection. If you need results sooner, a rush option with a 5-business-day turnaround may be available, depending on capacity during busier times of the year.

Yes. Many firms now offer a fully online cost segregation study process. At R.E. Cost Seg, the entire engagement, from document submission to engineering analysis to final report delivery, can be completed remotely. Virtual inspections using photos, video walkthroughs, and satellite imagery allow engineers to classify property components without an in-person visit. Online studies are faster and more convenient, Rapid Reports and Fully Engineered Studies are equally defensible, and recordings of virtual inspections are available as evidence if ever needed.

No, not if you want a defensible cost segregation study. A study requires supported asset classification, construction-cost analysis, tax knowledge, and documentation that can withstand review. Property owners can help gather records, but the analysis should be completed by qualified cost segregation specialists.

Often, yes. A look-back cost segregation study can identify depreciation that should have been claimed in earlier years. The adjustment is generally reported through Form 3115 as a change in accounting method, allowing the cumulative catch-up adjustment under §481(a) without amending each prior return. R.E. Cost Seg offers Form 3115 preparation to support this process; your tax professional should review and file the completed tax treatment with your return.