How To Do A Cost Segregation Study When It Saves You Money and When It Doesn’t

In this episode, host Toby Mathis, Esq., welcomes returning guest Chris Streit to break down the truth about cost segregation studies — when they work, when they don't, and who should consider one. Chris explains how cost seg studies accelerate depreciation by separating a property's components into shorter-lived assets, enabling large year-one deductions under bonus depreciation rules. They walk through a real-world example of a $500,000 duplex to illustrate potential tax savings, and discuss who qualifies to use those losses — including real estate professionals versus passive investors.
The conversation also covers the best and worst property types for cost seg, how to use studies to offset rental income across a portfolio, and whether you can apply a study retroactively after a tax year has ended. Chris shares critical red flags to watch for when hiring a cost seg firm, including improper land valuation, lack of site visits, and insufficient substantiation — all of which can expose investors to serious IRS risk. Tune in for expert, no-nonsense guidance on one of real estate's most powerful — and misunderstood — tax strategies.

 Highlights/Topics:

00:00 Intro - Bonus depreciation and year one write-offs
04:01 Who should consider a cost seg study
06:06 Example 500K duplex breakdown
10:00 Real estate professional versus passive investors
14:19 Best versus worst property types for cost seg
18:25 Red flags and bad cost seg providers
22:08 Importance of site visits and proper substantiation
25:20 The biggest mistake real estate investors make
27:32 How to get started with a cost seg study
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Resources:

CSA Partners (Chris Streit's company — cost segregation specialists): https://csap.com/

Request a FREE Cost Segregation Benefit Analysis: https://aba.link/594e87

Anderson Advisors Free Workshop (asset protection & business structure): https://aba.link/7gdd

Anderson Advisors
https://andersonadvisors.com/

Toby Mathis YouTube

https://www.youtube.com/@TobyMathis

Toby Mathis TikTok

https://www.tiktok.com/@tobymathisesq

Clint Coons YouTube

https://www.youtube.com/@ClintCoons