Site-visited. Engineer-led. Workpapered to the line.
Every commercial study at Commercial Cost Seg follows the same eight-step engineered methodology. No software shortcuts, no template outputs, no remote-only "desktop" studies. Every component classification is engineered and second-reviewed.
Scoping
A 15-minute scoping call establishes property type, acquisition basis, year built, and the engagement scope. The partner returns an engagement memo within one business day defining the fee, the deliverable, and the timeline. Pricing for commercial studies is property-specific; the memo locks the fee before any engineering work begins.
Document intake
Closing documents, tax assessment records, prior cost segregation reports (if any), construction documents, and any architectural or mechanical drawings are intaken and indexed. The engineer requests specific documents based on the property type and any open questions raised in scoping.
Site visit
A credentialed professional engineer (PE) visits the property to record the physical condition, capture photographs of every reclassifiable component (mechanical rooms, electrical panels, specialty systems, finish details), and verify component counts against the construction documents. Remote-only studies are not offered for commercial properties — every commercial study has a site visit.
Asset identification
The PE inventories every reclassifiable component, classifies each into its MACRS bucket (5-year, 7-year, 15-year, 27.5-year if residential, 39-year if commercial structural), and documents the engineering basis for the classification. Section 1.48-1(c) of the Treasury Regulations sets the permanence test; component-level rationale is recorded for any item that requires defense.
Cost allocation
Each component is costed using RSMeans 2024 unit pricing and the BLS Producer Price Index for non-residential construction. Geographic cost factors are applied using metro-calibrated indices. Costs reconcile to the total depreciable basis to the penny.
Second-engineer review
A second engineer reviews every component classification, the cost allocation, and the methodology narrative. The reviewer's sign-off is documented in the report's quality control section. No study leaves without two PE signatures.
Report preparation
The 30+ page IRS-defensible report is prepared. Sections include the executive summary, property description, methodology narrative, component schedule, cost reconciliation, depreciation schedule, audit-defense documentation, and engineer credentials. The report follows the structure of the IRS Cost Segregation Audit Techniques Guide.
Delivery & defense
The final report is delivered to the property owner and their CPA. Audit defense is included for the life of the study — if the IRS examines the property's depreciation, the engineering team supports the position at no additional cost. Form 3115 is provided when the study captures Section 481(a) catch-up depreciation from prior years.
Standards and references
Commercial Cost Seg studies are prepared in accordance with the standards established by the American Society of Cost Segregation Professionals (ASCSP) and the IRS Cost Segregation Audit Techniques Guide. Every component classification is supported by a citation to the relevant Treasury Regulation, IRS guidance, or judicial authority.