Estimate how reclassifying building components into shorter-life asset classes accelerates depreciation — and what that timing is worth to you in present-value tax savings.
The Property
Reclassification
Build each class from its components. Each line is a % of the depreciable basis and rolls up to the class total. Defaults are benchmark starting points — edit, rename, or add lines to fit the property.
Total short-life reclassified—
Your Assumptions
Year 1 deduction
—
Extra Year 1 write-off
—
Year 1 tax savings
—
First 5 yrs — extra deductions
—
Net present value of benefit
—
Year 1 depreciation — head to head
Without cost seg—
With cost seg—
Cumulative depreciation over time
Both paths deduct the same total basis — cost seg just front-loads it. The gap between the curves, discounted to today, is the benefit.
Depreciation schedule (first 15 years)
Yr
With cost seg
Without
Difference
Tax saved
Lifetime deductions are identical in both columns — the entire benefit is timing. Later years show negatives as the straight-line path "catches up."
Before you rely on this
This is a planning estimate, not an engineering-based cost segregation study. Actual reclassification percentages must come from a qualified study and vary widely by property.
Bonus eligibility: 100% bonus is permanent under the One Big Beautiful Bill Act only when the property is both acquired and placed in service after January 19, 2025. Property under a binding contract before January 20, 2025 stays on the old phase-down (40% in 2025, 20% in 2026). Used property must be new to you and arm's-length. Only the 5-, 7-, and 15-year buckets get bonus — never the building shell.
Recapture: accelerated depreciation increases ordinary-income recapture (§1245) and unrecaptured §1250 gain (taxed up to 25%) when you sell. Cost segregation is mostly a deferral / present-value benefit, not free money.
Passive losses: the resulting paper loss may be suspended unless you have passive income, qualify as a real estate professional, or meet active-participation rules (§469).
State conformity: many states decouple from federal bonus depreciation. The single blended rate here is a simplification.