STR Cost Segregation: Use Your Short-Term Rental to Offset W-2 Income

Yes. Our reports follow the IRS Audit Technique Guide for Cost Segregation (Pub. 5653) and use RSMeans 2024 cost data. We've delivered 4,000+ studies, and CPAs at every Big Four firm have filed returns with our work. If your CPA can't use it, we revise it free or refund the study — that's the CPA-Ready Guarantee.

No measurable increase. The IRS itself wrote the Audit Technique Guide we follow. STR/W-2 offset is a well-established strategy — the law (§469, Reg. §1.469-1T) is over 30 years old. What triggers audits is sloppy substantiation, which is exactly what an engineering-based study prevents. Every report includes the workpapers your CPA hands the IRS if questions come up.

No — that's the whole point of the STR loophole. REPS requires 750+ hours and more time in real estate than any other job, which most W-2 earners can't claim. The 7-day average rule under §469 reclassifies STRs as a non-rental trade or business, so you only need to materially participate (100+ hours) — not qualify as a real estate professional.

A full engineering-based cost segregation report: site analysis, asset reclassification, depreciation schedules for 5/15/27.5/39-yr property, IRS Form 3115 if needed, and all workpapers. Properties under $300K basis qualify for the $495 tier. Larger properties scale up — see our pricing section. Same engineering team across all tiers.

Most studies are delivered in under an hour after you complete the property questionnaire. Complex properties (rehabs, mixed-use, multi-unit) can take 1–2 business days. We don't charge a rush fee — same-day is standard.

Yes, and it's often the most powerful play. A look-back study lets you catch up missed depreciation in a single year via Form 3115 — no need to amend prior returns. We can study any property placed in service back to 1987. Many clients do this in Year 2 or 3 of ownership and recover six figures in deferred deductions.