On the Authentic Business Adventures Podcast, Tom Brodie, National Account Executive with CSSI – Cost Segregation Services, breaks down how bonus depreciation works and why it matters so much to commercial property owners.
Bonus Depreciation in Plain English
Normally, the cost of an asset is deducted a little at a time over its useful life. Bonus depreciation lets you deduct a large share of qualifying assets in the year they’re placed in service, so the tax savings show up now instead of over decades.
The 2025 tax law (the One Big Beautiful Bill Act) permanently restored 100% bonus depreciation for qualifying property acquired after January 19, 2025. Your CPA can confirm exactly how it applies to your situation.
Why Cost Segregation Is the Key
Here’s the catch: the building itself, depreciated over 39 years (27.5 for residential rentals), doesn’t qualify for bonus depreciation. The components that qualify, like certain electrical, flooring, lighting, parking areas and landscaping, are buried inside the building’s cost. A cost segregation study is the engineering-based analysis that finds them and moves them into 5, 7 and 15-year categories, where bonus depreciation can apply.
What It Can Mean for You
- Larger deductions in the first year
- Lower taxable income
- More cash to reinvest in your business or your next property
Example result: a restaurant purchased in July 2019 for $2,652,877 (less land) produced a first-year tax savings benefit of $464,126. Results vary by property.
See What Your Building Could Save
Tom will run a free, no-obligation estimate on your property, so you’ll know what’s possible before you commit to anything.
Prefer to talk now? Call Tom at 713-906-3710.
I’m a two time Texas A&M graduate (BBA: 1981 & MBA: 2001) who worked for Shell Oil Company for 26 years. I learned the importance of communications – both verbal and written, as well as problem solving skills. With experience ranging from finding intra-company billing errors to defining customer requirements in global budgeting software to teaching people how to scuba dive and take pictures underwater. Tom Brodie Bio
