Cost Segregation Study
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Unlock Hidden Value, Maximize Cash Flow: Discover the Power of Cost Segregation. By conducting a cost segregation study, property owners can realize $30,000 to $80,000 in tax savings per $1 million of building value in the first five years of ownership.

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    Bonus Depreciation Under OBBB

    The One Big Beautiful Bill Act (OBBB), signed in July 2025, restored 100% bonus depreciation for qualified property placed in service after January 19, 2025. This reverses the scheduled phase-down that began in 2023, where bonus depreciation dropped from 100% to 80%, then to 60% in 2024, and 40% in early 2025.

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    Main Takeaways After OBBB Was Signed

    • Distance
      100% Bonus Depreciation Restored

      OBBB restores full bonus depreciation for assets placed in service after January 19, 2025, reversing the phase-out.

    • Rocket_Launch
      Bigger Upfront Deductions = Better Cash Flow

      Investors benefit from larger first-year write-offs, reducing taxable income and improving cash-on-cash returns. Short-life assets identified in a Cost Seg study can now be fully expensed in Year 1, maximizing tax savings.

    • Language
      Ideal Timing for New Projects and Acquisitions

      Properties placed in service after the effective date qualify(January 19 2025), making 2025 a strategic year for running Cost Seg studies.

    What is Cost Segregation?

    Cost Segregation is a tax planning strategy that helps property owners utilize the full benefit of depreciation deductions by recategorizing assets they already own to appropriate class lives to increase cash flow and defer federal and state income taxes.

    Who can benefit?

    Any individual or business that owns commercial or residential real estate can benefit from cost segregation studies, especially those with properties valued at $1,000,000 or more.

    Cost Segregation Case Study

    The best way to view the direct financial benefits of a Cost Segregation Study is through the Leyton case study.

    Case Study by Building Type arrow_outward arrow_outward

    Leyton’s Steps For Success

    • looks_one

      The cost segregation team gets to know you and your property. An initial discussion and documentation submission will begin the process of uncovering sources of accelerated depreciation.

    • looks_two

      If necessary, the team will visit your site to spot any additional potential. If any depreciable assets slip through the cracks in your documentation, our team will spot them with a thorough in-person evaluation.

    • looks_3

      Report Submission. Our team of Cost Segregation experts will identify assets to be recategorized and calculate the additional depreciation deductions available to you. Our thorough and detailed report outlines our process, the tax law supporting your study, and the benefit to you and your company. 

    Cost segregation study simulation

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        Results
        Description
        %
        Costs
        Total Costs less Land
        Non-Segregated Costs
        Segregated Costs
        Pre-study Year 1 Depreciation
        Post-Study Year 1 Depreciation
        Post-Study Years 2-5 Depreciation
        Property Class
        %
        Depreciable basis
        5-Year Property
        –
        –
        7-Year Property
        –
        –
        15-Year Property
        –
        –
        15-Year QIP
        –
        –
        39-Year Property
        –
        –
        27-Year Property
        –
        –
        TOTAL
        –
        –

        What types of assets
        qualify under Cost Segregation study?

        Items considered personal property rather than structural components are often reclassified through cost segregation. This includes assets such as lighting, carpeting, cabinetry, and landscaping.
        Foundation

        Flooring (Carpet, Tile, Vinyl):

        Any removable or non-structural flooring, such as carpet, luxury vinyl plank (LVP), or vinyl composition tile installed after purchase. For example, office buildings often upgrade lobby flooring—this cost can be accelerated.

          Dresser

          Cabinetry and Millwork:

          Includes built-in reception desks, kitchenettes, shelving, and decorative wall paneling. In dental offices or medical spaces, these are common and often expensive—perfect candidates for shorter-life depreciation.

            Light

            Lighting and Electrical Systems:

            Interior and exterior lighting fixtures, accent lighting, or extra electrical work to support specialized equipment (like servers, medical equipment, or machinery) may be depreciated over 5–7 years.

              Hvac

              HVAC Systems (Split from Structural HVAC):

              Supplemental systems like ductless mini-splits, rooftop units serving specific areas, or improvements beyond the building’s original system may qualify.
              Example: New ductwork for kitchen-related equipment.

                Flip

                Site Improvements (Parking Lots, Sidewalks, Fencing):

                These fall into the 15-year land improvement category. Includes curbs, walkways, parking stripes, signage foundations, and perimeter fencing.
                Example: A newly paved lot added to a commercial warehouse.

                  yard

                  Landscaping and Irrigation:

                  Irrigation systems, outdoor lighting, retaining walls, planters, trees, and decorative stonework are eligible as land improvements.
                  Example: Landscaping added during a hotel remodel.

                    Miss Our Latest Cost Segregation Webinar?

                    How Landmark Tax Court Cases Shape a Cost Segregation Strategy 📅:

                    •Intro to cost segregation
                    •Changes in the One Big Beautiful Bill  
                    •Why is case law is so essential to cost segregation  
                    •White Co. Industries v. Commissioner (1978) 
                    •How to make your project “pro cost segregation”

                    Replay is Available! 👉

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