Buy a rental property and the default tax treatment spreads the building's cost evenly over 27.5 years (39 for commercial). That's the simplest option, and for a lot of smaller properties it's genuinely fine. It's also leaving money on the table for anyone who owns something bigger, or owns several properties, without realizing there's another option.
What a cost segregation study actually does
For tax purposes, a building is a roof, an HVAC system, flooring, parking lot, landscaping, wiring, and dozens of other components, each of which the tax code treats differently. A cost segregation study breaks the building apart and identifies which pieces qualify for much shorter depreciation schedules (five, seven, or fifteen years instead of 27.5), which can front-load a large amount of depreciation into the first year or two of ownership instead of spreading it evenly for decades.
Why it's not automatic
The study itself costs money and takes real analysis, so it's not something to bother with on a smaller property where the shift in timing wouldn't be worth the fee. It tends to make the most sense for higher-value properties, owners with several properties, or a year where the extra deduction is especially useful against other income.
The actual decision
Whether it's worth doing comes down to the math on one specific property in one specific year. Run the numbers before assuming either answer.
If you own rental property and have never had someone actually run this math for you, it's worth ten minutes to find out which side of that line you're on.
This post is general information, not specific tax, accounting, or legal advice. Your situation may differ, so talk to us before acting on anything here.