Cost segregation—a tax strategy that accelerates depreciation deductions for property owners—got a massive boost from the 100% bonus depreciation under the 2017 Tax Cuts and Jobs Act (TCJA). From late 2017 to 2022, this allowed immediate write-offs for short-life assets identified through cost segregation studies. Now, with the bonus phasing down (60% in 2025, dropping 20% annually until 2027), many wonder if it could return. President Trump has already signaled his intent to reinstate it, citing its success in spurring investment. While economic pressures, real estate lobbying, and potential 2025 TCJA revisions fuel the speculation.
What a Comeback Would Mean
If Trump succeeds in bringing back 100% bonus depreciation, cost segregation would reclaim its supercharged status. Picture buying a $2 million building and deducting over $500,000 in short-life components in year one, potentially saving over $100,000 in taxes instantly. This could apply to both new and used properties, amplifying cash flow for investors and boosting real estate strategies, especially if Trump’s promise becomes reality in 2025.
Act Now, Watch the Horizon
For now, the 60% bonus in 2025 still makes cost segregation worthwhile, but waiting for a full comeback isn’t a strategy—act while benefits remain. Keep tabs on Congressional tax debates; a new stimulus or post-2024 election shift could bring 100% back. Until then, consult a cost segregation pro to leverage what’s available.
