Let’s say you own a non-residential commercial building. During the first 39 years of ownership, you get a tax deduction of 1/39th of the building’s value, each year.
Today, pieces of the building like carpeting, specialty lighting, certain plumbing fixtures, and landscaping can be “segregated” from the building. With Cost Segregation, an IRS approved technique, these segregated assets can be expensed faster, on a 5, 7 or 15-year schedule, based on their individual depreciable lives – as opposed to being part of the building’s 39-year straight-line depreciation schedule.