I’m about to do my first cost segregation study and I’m stuck on the dumb part, picking the firm. If you’ve used any of these, who would you trust for a normal deal, R. E. Cost Seg, KBKG, Engineered Tax Services, or CSSI?
Context, this is a straightforward investment property, not a primary. I’m not trying to chase the biggest first year write off, I’m trying to avoid buying a report that my CPA side eyes or that turns into a mess if it ever gets questioned.
The quotes I’ve gotten are all over the place. Different fees, different timelines, and the projected reclass percentages vary way more than I expected, which makes me wonder how much of this industry is methodology and how much is sales.
For people who’ve done it, what actually mattered after the fact
Did your CPA care about engineered vs non engineered, or just the quality of the asset list
Virtual walkthrough vs in person site visit, did it change anything
What did audit support look like in reality, did anyone actually need it
Were there any red flags in the process that you wish you recognized earlier, like aggressive land allocation, vague summaries, no real fixed asset schedule, etc
I’m fine paying for quality, I just don’t want to pay for a pretty PDF and false confidence.
Cost segregation on a smaller rental, how do you pick a firm without getting sold a fantasy number
byu/Xo_Obey_Baby inRealEstate
Posted by Xo_Obey_Baby
2 Comments
I went with KBKG a couple years back and honestly they were solid. My CPA didn’t bat an eye at their report and the asset breakdown was detailed enough that it felt legit, not just some cookie cutter percentage game
The virtual walkthrough thing is mostly marketing BS unless you have some weird custom build. Standard rental property? They’ve seen a million of them already. I’d focus more on whether they actually give you a real fixed asset schedule you can hand to your CPA without looking like an amateur
Get an in-person live walkthrough from a well regarded local firm. I paid cost segregation guys (online firm) to do one and they made a total mess of it resulting in additional time and expense for me. Would not recommend them. A local well regarded firm will be much more expensive but if it ever gets questioned it will be bulletproof.