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Bottom-funnel ROI calculator

$1 spent on a cost seg study
returns 48× back in Year-1 tax savings.
Is yours that good?

You've seen your deduction estimate. The question that actually decides the purchase is whether the $795 study fee is worth it for your specific property, bracket, and acceleration. This page runs that math live.

CS Cost Seg Smart Research Team Last reviewed May 11, 2026 ~5 min read
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How the math works

Four numbers stand between you and an answer.

Most calculators show you a deduction and leave the ROI implicit. We'd rather walk you through the four levers and let you see exactly where the multiple comes from.

01 / Basis

Start with what's actually depreciable.

On a $500,000 short-term rental, land typically runs ~20% of the purchase price and isn't depreciable. The headline math on this page uses purchase price directly for clarity; the methodology page shows the land-net version.

→ IRS Pub 946 §1, "Property You Can Depreciate"

02 / Acceleration

Reclassify what the engineers actually find.

A cost seg study moves components — appliances, flooring, site improvements — from a 27.5-year bucket into 5, 7, and 15-year buckets. For an STR, that's typically ~30% of basis. Office? 29%. Medical? 33%. Industrial? 20%.

→ Rev. Proc. 87-56, Asset Class Lives

03 / Bonus depreciation

100% in 2025 and 2026. That's the whole game.

100% bonus depreciation means every dollar reclassified into a sub-20-year life gets deducted in Year 1. For 2024 acquisitions it was 60%; for 2023, 80%. If you bought in 2025 or later, you're looking at the most aggressive Year-1 deduction the tax code has offered in a decade.

→ IRC §168(k), per OBBBA 2025

04 / Bracket

The deduction is the prize. Your bracket is the conversion rate.

A $120,000 deduction in the 32% bracket is $38,400 of actual cash you don't pay the IRS. In the 24% bracket: $28,800. In 37%: $44,400. Add state on top — California's 13.3% turns a $120K deduction into another $15,960 of savings.

→ Rev. Proc. 2025-32, 2026 tax brackets

Three real shapes of buyer

Where the ROI math actually lands.

See the full STR walkthrough
Scenario A · Phoenix STR A doctor on $420K income buys a $500K Airbnb. 65×
Property$500K STR · 30%
Federal + state32% + 2.5% AZ
Year-1 deduction$150,000
Net Year-1 benefit$50,955
Study fee$795
Read the worked example Scenario B · 12-unit MF A California REPS couple buys $2.4M of multifamily. 132×
Property$2.4M MF · 17%
Federal + state35% + 13.3% CA
Year-1 deduction$408,000
Net Year-1 benefit$195,569
Study fee$1,495
Read the worked example Scenario C · Lookback A REPS landlord catches up four years of missed depreciation. 51×
Property$340K Duplex · 19%
Federal bracket24% (TX)
4-yr lookbackForm 3115 §481(a)
Year-1 cash$25,118
Study fee$495
Read the worked example
When this doesn't work

The pitch isn't always 48×.

Most calculators only ever show you the good case. Here are the four shapes where a study underperforms, or shouldn't be ordered at all.

Full methodology + caveats

You're a passive investor with no offsetting passive income

If you're not a real estate professional and your rental isn't an STR with material participation, your Year-1 paper loss is suspended under §469. The deduction doesn't disappear — it carries forward to a year you have passive income or sell. Your true Year-1 cash benefit may be $0.

You plan to sell within 3–5 years

Depreciation recapture at ordinary rates can claw back the bulk of the Year-1 savings on exit. The math still tends to win, but the multiple drops sharply. The next-step calculator on costsegsmart.com models recapture properly.

You're in the 10–12% bracket

At 12%, a $150,000 deduction is $18,000 in cash. The study still beats its fee by ~20×, but a study costing $1,495+ on a $1.2M property in the 12% bracket is probably an over-investment vs. a basic 1245-asset schedule from your CPA.

Your acquisition is older than 8 years

Lookback via Form 3115 still works, but the math gets thinner as the unrecognized depreciation tail shrinks. Properties acquired pre-2018 have the lowest typical ROI of any cohort we see.

Frequently asked

What people actually want to know.

The 20 most-asked questions about whether the study fee is worth it.

How is "ROI multiple" actually computed?
Year-1 federal tax savings divided by the study fee. If you opt into the state-rate input, we add state savings to the numerator. Net Year-1 benefit (savings − fee) is shown separately so you can see the absolute dollars, not just the ratio.
Why does the calculator default to using purchase price instead of basis?
For the headline, simpler math beats more accurate math. Most users don't know their land allocation; using purchase price overstates the deduction by ~20%. We show the land-net version under the "Advanced" toggle and on the methodology page.
What is the study fee tier based on?
Purchase price brackets used by Cost Seg Smart: under $500K → $495, $500K–$1M → $795, $1M–$2M → $1,495, $2M–$5M → $1,995, $5M+ → $2,995. The fee shown on this page is the fee you'd actually pay if you ordered.
What if I'm a passive investor — can I still benefit?
Yes, but not in Year 1 unless you have offsetting passive income. Your reclassified depreciation suspends and rolls forward under §469. When you sell, or earn passive income in a future year, the deduction unlocks. The dollar value of the deduction is unchanged; the timing changes.
How does the lookback (Form 3115) work?
If you bought a property in a prior year and didn't accelerate depreciation, you can catch up the missed deductions in the current year via a §481(a) adjustment on Form 3115. No amended return needed. This often doubles Year-1 cash for properties acquired 2–7 years ago.
Is the calculator's number IRS-defensible?
The calculator is an estimate. An actual cost segregation study from a qualified engineer is what's IRS-defensible — that's what produces the depreciation schedule your CPA files. This page tells you whether ordering that study is a good financial decision; it's not a substitute for the study.

Run your numbers above.
Order if they make sense.

The calculator inputs carry into your study order. If your finished study doesn't produce more deductible depreciation than the fee, we refund the fee.

Order your real study at costsegsmart.com