Accelerated Depreciation
Reclassify building components into 5-, 7- and 15-year asset lives to bring deductions forward instead of spreading them over decades.
The Basics
What is Cost Segregation?
In plain terms: it's a way to keep more of your own money working inside your business—sooner rather than later.
When you buy, build or improve a commercial property, the IRS normally lets you write off its cost slowly—over 27.5 or 39 years.
But a building isn't just one asset. It's made up of dozens of individual components—lighting, flooring, cabinetry, specialty plumbing, parking, landscaping and more—that legally qualify for much shorter write-off periods of 5, 7 or 15 years.
A Cost Segregation study identifies those components and reclassifies them properly. The result: larger depreciation deductions in the early years of ownership, lower taxable income and meaningful cash flow back in your hands—cash you can use to reinvest, expand, hire or pay down debt.
Same property. Same tax code. Better timing.
01
Faster Deductions
Move write-offs from decades away into the current tax year.
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Stronger Cash Flow
Pay less tax now and keep capital available for the business.
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Fully IRS-Aligned
A defensible, engineering-based study coordinated with your CPA.
Benefits of Cost Segregation
Benefits of Cost Segregation.
Improved Cash Flow
Unlock capital in the years it matters most—cash you can reinvest, expand with, or use to pay down debt.
Increased Tax Savings
Lower taxable income now by capturing every eligible short-life asset the tax code already allows.
Engineering-Based Studies
Detailed, on-site engineering analysis that identifies and documents every qualifying component of your property.
CPA Coordination
Structured to complement—never compete with—your existing CPA, with clean handoffs and shared documentation.
IRS-Compliant Methodology
Audit-ready deliverables built to the IRS Cost Segregation Audit Techniques Guide standards.
Who It Fits
Who benefits most from a cost segregation study.
Cost segregation is most impactful for property owners with meaningful basis and a taxable position that can absorb accelerated deductions.
- 01Commercial real estate owners
- 02Multi-family and rental portfolios
- 03Medical, hospitality and industrial facilities
- 04Recently acquired, built or renovated property
- 05Properties placed in service since 1987
- 06Owners with $500K+ in building basis
Our Process
A coordinated, five-step engagement.
- 01
Free Eligibility Review
A no-cost, no-obligation review of your property to estimate the potential benefit.
- 02
Property Evaluation
We gather cost records, drawings and site details to scope the study accurately.
- 03
Engineering Study
Engineering partners identify and document every qualifying short-life component.
- 04
CPA Coordination
We work directly with your CPA to align results with your overall tax strategy.
- 05
Tax Savings Delivered
You receive an audit-ready report and start capturing accelerated deductions.
Why Freedom Alliance
A trusted advisor,
not an engineering firm.
Freedom Alliance doesn't sell you an engineering study. We identify the opportunity, assemble the right specialists, and keep the entire process coordinated with the CPA and advisors you already trust.
Our job is to make a technical, often intimidating process feel simple—so the value ends up where it belongs: in your business.
- Strategic Advisory First
- We evaluate whether a Cost Segregation study is right for your property before anyone recommends one—free of pressure or sales incentive.
- Qualified Engineering Partners
- Studies are performed by vetted, credentialed engineering firms whose methodology stands up to IRS scrutiny.
- Coordinated With Your CPA
- We work alongside your existing tax advisor with clean handoffs, shared documentation and no disruption to the relationships you rely on.
- One Point of Accountability
- A single advisor manages every party involved—engineers, CPAs, attorneys—so you never have to project-manage the specialists.
- Simple, Transparent Process
- Clear expectations, straightforward communication and no jargon. You always know what's happening, what's next, and what it means.
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Related Advisory
Often paired with 179D and strategic planning.
Property owners rarely benefit from cost segregation in isolation. We routinely coordinate studies alongside 179D energy incentives and a broader strategic incentive plan to ensure every eligible dollar is captured.
FAQ
Frequently asked questions.
Straightforward answers to the questions property owners most often ask before starting a Cost Segregation study.
What is Cost Segregation?
Cost Segregation is an IRS-recognized tax strategy that reclassifies components of a commercial property into shorter recovery periods (5, 7 or 15 years) instead of the standard 27.5 or 39 years—accelerating depreciation and improving near-term cash flow.
Who qualifies?
Owners of virtually any income-producing commercial or investment property—hotels, offices, apartments, retail, medical, industrial, self storage, short-term rentals and more—typically with a building basis of $500,000 or more.
Is this IRS approved?
Yes. Cost Segregation is a well-established methodology recognized in the IRS Cost Segregation Audit Techniques Guide. Every study we coordinate is engineering-based and built to withstand IRS scrutiny.
Can older properties qualify?
Yes. A look-back study can capture missed depreciation on properties placed in service in prior years—without amending past returns. The catch-up deduction is recognized in the current tax year.
Do I need to replace my CPA?
No. We work alongside your existing CPA and complement their work. Our role is to bring specialized capability that most CPAs don't provide in-house, with clean handoffs and shared documentation.
How long does a study take?
Most studies are completed within 4 to 8 weeks from kickoff, depending on property size, complexity and document availability. We provide a timeline up front so there are no surprises.
How much can I save?
Results vary by property, but it's common for owners to reclassify 20% to 40% of a building's cost basis into shorter recovery periods—often producing six- or seven-figure first-year tax benefits. A free eligibility review will estimate your specific opportunity.