IRS Compliant Cost Segregation Study Services
Reduce your federal tax liability and improve cashflow with professional cost segregation services from O’Connor. We offer fast, IRS-approved studies tailored for real estate owners, investors, and developers across the United States. Our engineering-based approach ensures accurate asset classification and supports aggressive bonus depreciation benefits, helping you reinvest capital and grow faster.
What Is a Cost Segregation Study?
This is a thorough study of a property utilizing several disciplines in order to find depreciable assets. This allows certain assets to be broken away from the main property in a modular fashion, allowing the taxpayer to apply depreciation away from the build or land itself. This can include HVAC, fencing, fixtures, machinery, parking lots, kitchen equipment, and other assets. These are then broken down into groups based on lifespans of five, seven, or 15-year categories.
- Immediate reduction in federal taxable income
- Increased first-year deductions
- Enhanced cashflow
- Reinvestment opportunities
Whether you’re acquiring, building, or renovating property, this approach helps you unlock significant income tax savings, often in the six- to seven-figure range.
How Our Study Works
At O’Connor, we specialize in real estate analysis tailored to each property’s structure, use, and value. Our licensed engineers and appraisal professionals ensure every study is precise, compliant, and defensible under audit.
Our Process:
- Initial Review & Free Estimate: We evaluate your property and provide a no-obligation savings estimate.
- Engineering Analysis: Our experts conduct an on-site or document-based component review to identify eligible short-life assets.
- Report Delivery: Within days, we deliver a full report aligned with IRS Audit Techniques Guide documentation.
- CPA Collaboration: We work directly with your CPA to apply the findings to your tax filings, including preparation of Form 3115 where needed.
No amended returns are required — our studies include change-in-accounting documentation to help you claim missed depreciation retroactively.
Accelerate Bonus Depreciation & Tax Savings
O’Connor’s studies also support bonus depreciation cost segregation under the Tax Cuts and Jobs Act and the One Big Beautiful Bill. As of 2025, properties placed in service can still qualify for 100% first-year bonus depreciation, making it crucial to act now.
The One Big Beautiful Bill and Reinstatement of Bonus Depreciation While the Tax Cuts and Jobs Act of 2017 was originally scheduled to sunset, starting December 31, 2022, On July 4, 2025, The One Big Beautiful Bill was signed into law permanently reinstating 100% bonus depreciation. Qualifying assets put into service after January 19, 2025 can now be written off immediately, which keeps cost segregation a valuable strategy for maximizing deductions.
Updated Bonus Depreciation Timeline
- Sept. 28, 2017 – Dec. 31, 2022 100% bonus depreciation available under the Tax Cuts and Jobs Act (TCJA).
- 2023 80% bonus depreciation (first step in the scheduled phase-down).
- 2024 60% bonus depreciation.
- Jan. 1 – Jan. 19, 2025 40% bonus depreciation (final phase of the TCJA phase-down).
- Jan. 20, 2025 and onward 100% bonus depreciation permanently restored
Bonus depreciation benefits:
- Apply to both new and used properties
- Allow upfront write-offs on qualified components
- Stack with cost segregation for maximum impact
Our team ensures you’re leveraging all available federal incentives to reduce taxable income.
Benefits for Real Estate Investors & Developers
An expert study is ideal for:
- Real estate syndications
- REITs and investment groups
- Multi-property portfolio holders
- Developers of commercial, multifamily, and industrial assets
Whether you’ve recently acquired, built, or renovated, this technique lets you:
- Offset rental income with higher depreciation
- Improve investor ROI
- Reallocate cash for future acquisitions
Applicable property types:
- Apartment complexes
- Office buildings
- Retail and shopping centers
- Warehouses and distribution facilities
- Hotels and hospitality assets
- Health care and hospitals
- Restaurants
- Countless other commercial enterprises
Why Choose O’Connor?
With over a decade of experience, we’ve delivered cost segregation services for thousands of properties in more than 45 states, saving clients millions.
Why We Stand Out:
- Expertise: Engineering and appraisal professionals with IRS-audit-tested documentation
- Speed: Reports delivered faster than other national firms
- Responsiveness: Average email or call reply time under 15 minutes
- Simplicity: Minimal documentation required from clients
IRS Compliant Reporting & Audit Support
O’Connor strictly follows the IRS Audit Techniques Guide for all studies. Our documentation is built to withstand audit scrutiny and support your CPA with:
- Detailed depreciation schedules
- Form 3115 change-in-accounting support
- Legal, engineering, and tax narratives
- Bonus depreciation qualification evidence
Audit defence documentation is included in every study at no additional cost.
About Cost Segregation FAQ
Any commercial or income-generating property owner, especially with property over $500,000 or recent renovations, should consider a study for maximum tax benefits.
When combined, these two tools allow eligible assets to be fully depreciated (up to 100% as of 2025) in the first year, amplifying savings.
Yes. When conducted per the IRS Audit Techniques Guide, these studies are fully compliant and frequently used in tax planning.
No. A standard Form 3115 allows you to claim missed depreciation without filing amended returns.
