Build-to-Rent & Single-Family Rental
Rental Property Cost Segregation
Build-to-rent communities and single-family rentals depreciate over 27.5 years by default — but appliances, flooring, cabinetry, and site improvements don't have to. Reclassify them into 5- and 15-year property for a large first-year deduction across your whole portfolio.
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$499* / $15,000
A $499* cost segregation workpaper for a rental property, for owners and advisors (*for a property whose purchase price plus construction costs total under $2.0 million); a $15,000 study up to $250 million in purchase price plus construction costs.
Typical delivery, stated up front
The report is typically ready 3–5 business days after all required documents are in. The full study is typically delivered 15–20 business days after complete documents are in.
ATG methodology
Built to the IRS Cost Segregation Audit Techniques Guide, with full asset detail and supporting documentation.
Why rentals benefit from cost segregation
Residential rentals use a 27.5-year recovery period — faster than commercial's 39 years, but still slow. A cost segregation study peels the short-life components out of that schedule: appliances, carpet and other readily removable flooring (not ceramic tile), cabinetry, and dedicated electrical become 5-year property, while driveways, fencing, and landscaping become 15-year land improvements. For build-to-rent operators the effect compounds across every unit, and bonus depreciation under IRC §168(k) front-loads the deduction.
| Rental asset | Reclassified to |
|---|---|
| Appliances (range, fridge, washer/dryer) | 5-year |
| Carpet, sheet vinyl & other readily removable flooring (not ceramic tile) | 5-year |
| Cabinetry & millwork | 5-year |
| Window treatments & blinds | 5-year |
| Dedicated appliance & specialty electrical | 5-year |
| Driveways, walkways & fencing | 15-year |
| Landscaping & site improvements | 15-year |
Rental property cost segregation FAQ
How much does cost segregation cost for a rental property?
The $499* cost segregation workpaper covers a rental property, ordered by the owner or by a CPA or advisor for a client (*for a property whose purchase price plus construction costs total under $2.0 million). Our $15,000 study covers a property whose purchase price plus construction costs total up to $250 million; an owner whose property is under $2.0 million is offered the workpaper instead. Above $250 million in purchase price plus construction costs, the study is scoped on a call with an advisor, and if you are not sure of the figure, Howard reaches out personally.
Does cost segregation work on residential rentals depreciated over 27.5 years?
Residential rentals use a 27.5-year recovery period, but appliances, carpet, sheet vinyl and other flooring installed so it can be readily removed (not ceramic tile), cabinetry, window treatments, and dedicated electrical typically reclassify to 5-year property, while driveways, fencing, and landscaping move to 15-year land improvements.
How much can a build-to-rent community reclassify?
BTR communities benefit from portfolio-scale site work and repeated unit finishes, so land improvements are often a large part of what moves into 5- and 15-year property. We do not publish a planning band for build-to-rent, so the share for a specific community comes from its cost detail rather than from a typical figure.
How long does it take?
Upload your closing statement, construction or unit-cost docs, and photos. The full study is typically delivered 15–20 business days after complete documents are in.
Is ClickDrag Finance's rental property cost segregation study engineering-based?
In its method, yes, for the study: ClickDrag Finance's rental property study applies an engineering principles-based methodology to your documents and photographs. The $15,000 cost segregation study is document-driven: it applies an engineering principles-based methodology, the cost classification approach described in the IRS Cost Segregation Audit Techniques Guide (Publication 5653), to the property's own documents and to photographs linked to the components they support, with a qualified human review of every component. The $499* workpaper is a separate product: a residual-estimation workpaper prepared from the documents and photographs the buyer provides. It is a workpaper for the taxpayer's tax preparer, prepared from the information the buyer provides, reviewed before release. *For a property whose purchase price plus construction costs total under $2.0 million.
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Start your studyClickDrag Finance as your residential rental cost segregation provider
We run cost segregation on single-family and small residential rental property. Residential rental is 27.5-year property under IRC §168(e)(2)(A), and the reclassification moves appliances, flooring, fixtures and site improvements into 5- and 15-year buckets.
Below roughly $500,000 of depreciable basis a study priced in the thousands of dollars often costs more than it returns — that figure is a pricing threshold, not a tax rule; it is lower for a lower-priced report, and our comparison page names the cases where a cheaper competitor is the better buy.
- Price
- $499 for a cost segregation workpaper on a rental property whose purchase price plus construction costs total under $2,000,000 — a workpaper for the taxpayer's tax preparer, reviewed before release, typically ready 3–5 business days after all required documents are in. $15,000 for the cost segregation study, for a property whose purchase price plus construction costs total up to $250,000,000 — qualified human review and oversight, typically delivered 15–20 business days after complete documents are in. Above $250,000,000, the scope is agreed on a call with an advisor before any price is quoted. Both are offered to owners and to CPAs or advisors acting for a client; the property's purchase price plus construction costs decide which one applies.
- Eligibility
- No unit-count limit and no hard minimum. A cost segregation study is worth it when three conditions hold together: the basis is large enough for the accelerated deductions to outweigh the fee (roughly $500K of basis for a study priced in the thousands of dollars, which is a pricing threshold rather than a tax rule, and lower for a lower-priced report), the deduction is usable this year given the owner's passive-activity position, and the hold is long enough to survive recapture. All three, or the honest answer is no.
- What is included
- Component-level classification documented to the IRS Cost Segregation Audit Techniques Guide, reconciled to your depreciable basis, with a depreciation schedule and a fixed-asset import template for your CPA, built from your documents and from photographs linked to the components they support.
- Payment
- The workpaper is paid in full at checkout; a study starts with a call and a proposal. All fees are non-refundable except as required by applicable law (see our terms).
Start your cost segregation study · Full pricing and eligibility · How we compare to other providers, including where a cheaper one is the better buy
Educational information, not tax advice. No estimate is a completed cost segregation study.
Who reviews and who signs a ClickDrag Finance cost segregation study?
| Question | $499* workpaper | $15,000 study |
|---|---|---|
| Who reviews it? | It is reviewed before release. | A qualified human review of every component, with a project manager on the engagement. |
| Who signs it? | It is a workpaper for the taxpayer's tax preparer, prepared from the information the buyer provides. | ClickDrag Finance signs the study (black label), and its signer block names its preparers: Howard Krieger (MBA, former ASA), Managing Director; and Robert H. Hutchins (CPA (Inactive), CVA (Emeritus)), Senior Tax Advisor. |
| Does a cost segregation study include a site visit? | It is prepared from the documents and photographs the buyer provides. | It can include a site visit, by appointment, and a visit is preferred; when a site visit is not feasible because of cost or timing, the property is documented from its own records and from photographs linked to the components they support, and each photograph’s embedded date and location data are read and recorded. |
| What audit support comes with it? | The workpaper and its stated procedures. | The deliverable itself is the support: the written study, with its methodology, cost sources and per-component classification rationale. |
*For a property whose purchase price plus construction costs total under $2.0 million.
Our terms set out the terms of each product.