Pricing for cost segregation study pricing right now?

Question

Curious what everyone here has actually seen in the market lately for cost segregation pricing on residential rental properties (single family).

A few things I’m particularly interested in:

- typical flat-fee pricing ranges

- whether pricing usually scales with property value

- full engineering studies vs DIY / software-driven / no-site-visit studies

- whether look-back studies are priced differently

- any difference for STR / Airbnb properties

Would love to hear from both investors and CPAs on what’s considered fair / standard right now.

Alex Torres · Answer

Here's what I've seen in the market recently for single-family residential:

Typical flat-fee pricing:                                                                                                                                                                                                                                                                                                                 - Full engineering firm (site visit + custom report, 4-8 weeks): $3K-$6K for sub-$1M residential, $5K-$10K for $1M-$3M

- Desk studies (engineer reviews photos remotely, 2-4 weeks): $1.5K-$3K

- Software / self-serve platforms (minutes to hours): $400-$800

Does it scale with property value?

Traditional firms sometimes tier by basis, sometimes flat-fee. One red flag: avoid any firm that prices as a % of your projected tax savings — that's a conflict of interest, and the IRS flags it as a circular 230 issue. Software platforms are almost always flat regardless of basis, because the engineering work is the same

whether the building is $300K or $900K.

Full engineering vs DIY / software-driven:

The "only engineering firms are defensible" argument is outdated. IRS Publication 5653 and the Cost Segregation Audit Techniques Guide allow multiple methodologies. What matters is whether the study uses:

1. RCNLD methodology (Replacement Cost New Less Depreciation)

2. Component-level line items, not rule-of-thumb percentages applied to a basis total

3. Full MACRS depreciation schedules

4. Case-law citations for contested classifications (cabinets, countertops, decorative lighting)

Software platforms that document all four are just as defensible as a $5K engineering report — you're paying more for the firm name and the site visit, not for a more "defensible" deduction. The audit question isn't "did an engineer sign it?" It's "can you reconstruct the methodology if the IRS asks?"

Look-back studies:

Usually the same price as a new-purchase study (engineering firms may add 10-25% for Form 3115 prep; software platforms typically don't charge extra). But the Year-1 deduction on a look-back is usually LARGER than a current-year study, because you're claiming the entire accumulated catch-up in one year. Pre-OBBBA acquisitions

(2023 = 80% bonus, 2024 = 60%) still benefit at those rates if you run the study now.

STR vs LTR pricing:

Same pricing at most firms — the engineering work is identical. Some firms offer an STR "package" bundling a material participation memo ($500-$1.5K extra), but you can get the same from your CPA. The real STR vs LTR difference is on the VALUE side, not the pricing side: STR hosts who materially participate can offset W-2

directly in Year 1; LTR deductions sit suspended until you have passive income or sell.

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Full disclosure per forum rules: cost segregation specialist at CostSegX.ai, one of the self-serve platforms in this market (1-4 unit residential under $1M basis). Framework above applies to any provider — I'm describing the market, not pitching.

Julius Vincent · Answer

@Louis Houette - Depends on the property value and how aggressive you want to be with the depreciation. For properties on the lower end (say ~$400K), I've seen solid results using software-driven firms like RE Cost Seg. Their reports are affordable (~$900) and detailed enough to hold up, especially when you're just looking to accelerate some depreciation without overcomplicating things.

Once you start getting into higher-value properties ($500K+), I generally recommend going with a full engineering-based study. The cost is higher ($2.5K-$4K), but the additional detail and defensibility tend to produce better outcomes.

I had a client recently get $180K of first-year depreciation on a $540K STR using a full study, which made a meaningful difference on her tax bill. Let me know if you'd like me to connect you with my cost seg contact.

Aaron Zimmerman · Answer

I've seen cost segs run between $3-4k for both STRs that are single families and multi families for on site, custom reports and form 3115.

Pricing for cost segregation study pricing right now?

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