If you Google "minimum property value for cost segregation," you will find a lot of articles telling you it does not make sense below $500,000 or $750,000. And for years, that was true — because the study itself cost $5,000 to $15,000. When the study eats half your tax savings, why bother?
That math is dead. Cost Seg Smart delivers IRS-aligned cost segregation reports for $795 and in under an hour. The "minimum property value" just dropped to basically any rental property worth owning.
The Old Math: Traditional Firms
Here is how the traditional cost segregation industry works. A firm sends an engineer to your property for a site visit. They spend 4-8 weeks writing a report. They charge $5,000 to $15,000. Then they hand you a PDF and disappear.
At those prices, the break-even math is simple:
- A $300K rental might generate $8,000-$12,000 in Year 1 tax savings from cost seg
- If the study costs $7,500, you keep $500-$4,500
- The ROI is 1x-1.6x. Not terrible, but not exciting
That is why every traditional firm tells you cost segregation "makes sense" starting at $500K+. They are not lying. At their prices, it does not make sense below that. But their prices are the problem — not cost segregation itself.
The New Math: $795
Cost Seg Smart is the modern cost segregation company. Same IRS-aligned methodology. Same component-level engineering analysis. Same CPA-ready reports. $795. Under an hour.
Watch what that does to the break-even:
| Property Value | Est. Year 1 Tax Savings | Traditional Cost ($7,500) | Traditional ROI | Cost Seg Smart ($795) | CSS ROI |
|---|---|---|---|---|---|
| $200,000 | $5,328 | -$2,172 | 0.7x | +$4,533 | 6.7x |
| $300,000 | $7,992 | +$492 | 1.1x | +$7,197 | 10.1x |
| $400,000 | $10,656 | +$3,156 | 1.4x | +$9,861 | 13.4x |
| $500,000 | $13,320 | +$5,820 | 1.8x | +$12,525 | 16.8x |
| $750,000 | $19,980 | +$12,480 | 2.7x | +$19,185 | 25.1x |
| $1,000,000 | $26,640 | +$19,140 | 3.6x | +$25,845 | 33.5x |
Assumes SFR, 18% reclassification rate, 80% depreciable basis, 37% tax bracket. Furnished STRs would be significantly higher.
Key takeaway: At $795, cost segregation generates positive ROI on a $200K rental property. At traditional pricing, you would lose money on that same property. The "minimum value" is a pricing problem, not a cost segregation problem.
When Cost Segregation Actually Does Not Make Sense
Let's be real — there are situations where cost segregation is not worth it, even at $795:
- Properties under $100,000: The depreciable basis after land allocation might be $60K-$70K. At an 18% reclassification rate, that is $11K-$13K accelerated, generating roughly $4,000-$4,800 in tax savings. Still positive ROI at $795, but barely. And if you are in a lower tax bracket, it gets tighter.
- Properties you are about to sell: If you are selling within the next year, cost segregation creates depreciation recapture that gets taxed at sale. The timing does not work.
- Properties that are not placed in service: You cannot depreciate a property that is not in use as a rental or business property. A vacant lot or a flip that has never been rented does not qualify.
Outside of those edge cases? If you own rental property and you have not done a cost segregation study, you are leaving money on the table. Period.
The Real Answer
There is no meaningful minimum property value for cost segregation anymore. Not at $795.
A $250K rental generates roughly $6,600 in Year 1 tax savings from cost seg. That is an 8.3x return on a $795 study. You spend more than $795 on a single plumbing call.
A $400K rental generates roughly $10,600 in Year 1 tax savings. A 13.4x return. You would not turn down a 1,340% return on any other investment, so why are you turning it down on your taxes?
The old "minimum value" was never about cost segregation. It was about an industry that charges $5,000-$15,000 for something that should cost $795. Traditional firms have offices to rent, engineers to fly in, and overhead to cover. That is their problem — not yours.
What About Bonus Depreciation?
It gets better. The One Big Beautiful Bill Act (OBBBA), signed in July 2025, permanently restored 100% bonus depreciation. That means every dollar of 5-year, 7-year, and 15-year property identified in your cost seg study is deductible in Year 1. All of it. No phase-down, no spreading it out.
During 2023-2024, bonus depreciation had phased down to 80% and 60% respectively. Those days are over. The full deduction hits your return the year you place the property in service.
This makes cost segregation more valuable at every property value level — especially for lower-value properties where every dollar counts.
STRs and Furnished Properties: Even Better
If your rental is furnished — short-term rental, vacation rental, furnished mid-term rental — the reclassification rate goes up significantly. Furnished properties typically see 22-28% of the depreciable basis reclassified, compared to 15-20% for unfurnished long-term rentals.
That means a $300K furnished STR might generate $12,000+ in Year 1 tax savings. On a $795 study. That is a 15x return.
And STRs get the bonus: if your average guest stay is under 7 days and you materially participate, your rental losses are not limited by passive activity rules. Those depreciation deductions can offset your W-2 income. For high-income earners, that is a game-changer.
Bottom line: If you own a rental property worth $150,000 or more and you have not done a cost segregation study, you are paying more in taxes than you need to. Cost Seg Smart reports are $795, delivered in under an hour, and CPA-ready. Everyone who owns rental property should be doing this. Make it make sense.
You spent six figures on a rental property. You spent thousands on closing costs. You pay hundreds a month on insurance. But you will not spend $795 one time to save thousands — or tens of thousands — in taxes?
Cost Seg Smart is the modern cost segregation company. IRS-aligned engineering methodology. Reports delivered in under an hour. $795, not $5,000. CPA-ready, with a money-back guarantee if your CPA rejects the report. Everyone who owns rental property should be doing this. There is no minimum property value. There is no excuse.
Run the numbers on your property. See what you are leaving on the table. Then stop leaving it there.