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Immediate Tax Savings
Accelerated depreciation generates large deductions in the first years of ownership, dramatically reducing your current-year federal and state tax liability.
Cost Segregation Specialists
Unlock Hidden Tax Savings
in Your Property
Powell Tax Consulting delivers cost segregation studies that accelerate depreciation, reduce your tax burden, and improve cash flow — often returning 4–8× the cost of the study in first-year savings.
20–40%
Average Tax Savings on Property Value
5–7 yrs
Typical Depreciation Acceleration
$1M+
Typical Minimum Property Value
What Is Cost Segregation?
A powerful, IRS-approved tax strategy that reclassifies building components to accelerate depreciation.
When you purchase or construct a commercial or residential rental property, the IRS typically allows you to depreciate the entire building over 27.5 years (residential) or 39 years (commercial). Most property owners accept this as the default — but they're leaving substantial money on the table.
Cost segregation is an engineering-based tax study that breaks down your property into its individual components — flooring, lighting, landscaping, specialized wiring, and more — and reclassifies them into 5-, 7-, and 15-year depreciation schedules instead of the standard 27.5 or 39-year schedule.
The result: dramatically higher depreciation deductions in the early years of ownership, deferring tax liability and keeping more cash in your hands right now.
Before vs. After Cost Segregation
Without Cost Segregation
$2,000,000 building depreciated over 39 years
≈ $51,282 / year in deductions
vs.
With Cost Segregation
Same building, accelerated components
Potential $200,000–$400,000 in Year 1 deductions
Example is illustrative. Actual results vary by property type and components.
Why Cost Segregation?
The financial benefits go well beyond a simple tax deduction.
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Improved Cash Flow
Lower taxes mean more cash available to reinvest in additional properties, pay down debt, or fund operations — compounding your wealth-building strategy.
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Bonus Depreciation
Qualifying components can be expensed 100% in the year placed in service under bonus depreciation rules, turbocharging first-year deductions.
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Look-Back Studies
Own a property for years without a cost segregation study? A look-back study lets you "catch up" on missed deductions — no amended returns required.
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Better ROI on Investment
Studies typically return $4–$8 in tax savings for every $1 invested, making cost segregation one of the highest-ROI tax strategies available.
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Works for Purchases & Renovations
Cost segregation is not just for new construction. Purchased properties and renovation projects can qualify too, unlocking deductions that have been hiding in plain sight.
Who We Serve
Cost segregation delivers value across a wide range of property types and ownership structures.
Real Estate Investors
Maximize after-tax returns on your rental portfolio. Whether you own single properties or a large portfolio, cost segregation dramatically improves your investment economics.
Residential RentalsShort-Term RentalsMulti-FamilyREITs
Commercial Property Owners
From office buildings and retail centers to warehouses and manufacturing facilities, cost segregation works across virtually all commercial property classes.
Office BuildingsRetail CentersIndustrial / WarehouseHotels
Real Estate Developers
Cost segregation is not only for new construction — purchased properties and renovation projects are prime candidates as well. Engage us early to ensure maximum component identification and optimal depreciation strategy from day one.
Purchased PropertiesRenovationsNew ConstructionTenant Improvements
CPAs & Accounting Firms
Partner with Powell Tax Consulting to deliver cost segregation as a value-added service to your clients. We provide thoroughly documented reports you can rely on.
CPA PartnershipsWhite-Label StudiesReferral ProgramTax Advisors
Our Process
A streamlined, four-step process designed to maximize your savings with minimal disruption to your operations.
01
Property Review
We gather property information — purchase documents, construction costs, blueprints, and prior depreciation schedules — to assess eligibility and estimate potential savings.
02
Engineering Analysis
We conduct a detailed review and, when needed, a site visit to identify and quantify all qualifying components using IRS-approved engineering methods.
03
Report Delivery
We deliver a comprehensive, fully documented cost segregation report that segregates assets by depreciation class with supporting schedules ready for your tax return.
04
Tax Filing Support
We work alongside your CPA or tax advisor to ensure the study is properly implemented on your return and answer any questions that arise.
Why Choose Powell Tax Consulting?
Not all cost segregation providers are equal. Here's what sets us apart.
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Engineering-Based Accuracy
Our studies are prepared using IRS-approved engineering methodology — not desktop estimates or rule-of-thumb percentages. This maximizes legitimate deductions for your property.
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Client-Centered Approach
We work directly with you and your tax team throughout the process.
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Transparent Fee Structure
Our fees are fixed and disclosed upfront. We never charge as a percentage of savings — a fee structure the IRS has flagged as problematic for other providers.
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Fast Turnaround
Most studies are completed within 3–6 weeks of receiving property documents. We understand tax deadlines and work to meet yours.
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Free Preliminary Analysis
Before you commit to anything, we provide a free benefit estimate so you know the expected savings range upfront — with no obligation.
Frequently Asked Questions
Answers to the most common questions about cost segregation.
What types of properties qualify for cost segregation?
Most commercial and residential rental properties with a depreciable basis of $500,000 or more benefit from a study. This includes office buildings, retail centers, warehouses, hotels, apartments, and rental houses. New construction, acquisitions, and renovations are all eligible.
How much does a cost segregation study cost?
Study fees vary based on property type, size, and complexity. Residential studies start as low as $500, while other property types typically start at $5,000. Because the tax savings typically far exceed the study cost — often 4–8× — the fee is almost always recovered in Year 1.
Is cost segregation IRS-approved?
Yes. Cost segregation has been explicitly recognized by the IRS since the 1997 Hospital Corporation of America Tax Court ruling. The IRS has also published a detailed Cost Segregation Audit Techniques Guide for examining these studies, confirming their legitimacy when properly prepared.
Can I do a cost segregation study on a property I've owned for years?
Yes. A look-back study allows you to claim the cumulative depreciation you missed in prior years all in the current tax year by filing a Form 3115 (Change in Accounting Method). No amended returns are required.
How long does a cost segregation study take?
Most studies are completed within 3–6 weeks after we receive the required property documents. Complex or larger properties may take longer. We always confirm timelines at the start of an engagement.
Do I need to do anything differently at tax time?
Your CPA will use the report to update your depreciation schedules. For look-back studies, a Form 3115 is filed with your return. We coordinate directly with your tax advisor to ensure smooth implementation.
What is bonus depreciation and how does it interact with cost segregation?
Bonus depreciation allows you to immediately expense a percentage of eligible property placed in service during the year. When combined with cost segregation, qualifying 5-, 7-, and 15-year components identified in the study may be fully expensed in Year 1, dramatically increasing the immediate tax benefit. We advise clients on optimizing bonus depreciation elections as part of every study.
Get Your Free
Property Analysis
Tell us about your property and we'll provide a no-obligation estimate of your potential cost segregation savings. Most property owners are surprised by how much they're leaving on the table.
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Email
info@powelltaxconsulting.com
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Response Time
Within 1 business day