Cost segregation for residential real estate

At Cost Recovery Experts (CRE), we help residential property owners and investors maximize cash flow and tax savings through engineer-backed cost segregation studies. Whether you own single-family rentals, multi-family homes, or short-term rental properties, our services are designed to reduce tax liability, enhance financial statements, and provide IRS audit protection.

• Residential Cost Segregation Studies
  Identify and reclassify eligible building components to shorter depreciation categories, allowing you to accelerate deductions and reduce current-year taxes.
   
• IRS Audit Protection
  All studies are fully documented and engineer-backed, providing peace of mind that your tax positions are protected.
   
• Depreciation Schedule Review & Optimization
  Review your existing depreciation schedules to ensure all qualifying assets are properly classified and maximizing benefits.
   
• Look-Back Studies & Retroactive Benefits
  Recover missed depreciation from previous tax years to increase cash flow and potentially amend prior returns.
   
• Short-Term Rental Optimization
  Specialized guidance for vacation rentals, Airbnb properties, and other short-term rental investments to capture maximum depreciation benefits.
   
• Multi-Property Portfolio Support
  Strategic analysis for residential investors with multiple rental properties, ensuring each asset achieves optimal tax benefits.
   

Cost segregation is a powerful tax strategy that can significantly enhance the cash flow of residential real estate investors. While you may already be familiar with the general concept of cost segregation, exploring its specific application to residential properties can reveal fresh paths to tax savings and financial expansion. Keep reading to learn more about how you can make informed decisions on cost segregation that align with your investment goals.

• Accelerate depreciation to lower current-year taxes.
   
• Increase after-tax cash flow for reinvestment, renovations, or expansion.
   
• Improve financial statements by accurately classifying assets.
   
• Reduce audit risk with thorough, engineer-backed studies.

Cost segregation can be applied to a wide range of residential properties, helping owners accelerate depreciation and maximize tax benefits. Eligible properties include:

• Single-Family Rental Homes – Rental homes are considered income-producing properties, making them eligible for cost segregation.
   
• Multi-Family Buildings – Apartment complexes and multi-unit rental properties are ideal candidates. Larger properties often have more components that can be reclassified for accelerated depreciation.
   
• Condominiums – Individual units that are rented out, as well as common areas within the complex, may qualify.
   
• Senior Living Facilities – Properties used for independent living, assisted living, or memory care can benefit from cost segregation.
   
• Mixed-Use Properties – Buildings with both residential and commercial spaces qualify when at least 80% of rental revenue comes from residential units.
   
• Vacation Rental Properties – Short-term rental properties, including Airbnb or vacation homes, are eligible for accelerated depreciation.

By taking advantage of cost segregation, residential property owners can unlock significant tax savings, improve cash flow, and reinvest in their properties or portfolios. At CRE, our engineer-backed studies ensure every eligible component is accurately identified and documented, giving you maximum depreciation benefits and full IRS audit protection. Let us help you make your residential investments work harder for you.