Episode Summary
Cost segregation expert Richmond Stacker (CEO, USA Cost Segregation) joins Tommy Thompson and Justin Kiehne to unpack the tax code’s most powerful real estate tool. This episode covers the cost segregation fundamentals, why the short-term rental “loophole” is a trap, the recapture arbitrage most investors miss, and how the One Big Beautiful Bill made 100% bonus depreciation permanent starting January 19, 2025.
Key Takeaways
• Cost seg = an engineering study that reclassifies building assets into 5-, 7-, and 15-year property, front-loading 30–40% of your basis into year-one deductions.
• 100% bonus depreciation is BACK — and permanent — for property placed in service on or after January 19, 2025 under the OBBBA.
• QIP expensing (HVAC, roof, flooring) sunsets Dec 31, 2029. That piece isn’t permanent — the clock is ticking.
• Not for everyone. Skip cost seg on properties under ~$500K, on properties you’re about to sell, or when you already have losses.
• The short-term rental “loophole” is a trap. 100-hour material participation, no property manager, no 7+ day stays — most investors don’t actually qualify.
• Recapture is real, but so is the arbitrage. Offset income at 37%, recapture at 25%, and use a 1031 exchange to eliminate it entirely.
• Bought property in 2022–2024 without doing cost seg? Not too late. A Form 3115 catch-up can convert taxes owed into a refund.
• The math checks out. One client paid ~$7K more for a proper study and captured an additional $400K in tax savings.
Chapters
00:00 Intro — why cost seg is the most powerful tool you’re not using
02:00 How to explain cost seg at a cocktail party
04:00 Straight-line vs. accelerated — the $1M property math
09:00 Who’s a good candidate (and who isn’t)
19:00 The short-term rental trap
28:30 Recapture, arbitrage, and the 1031 escape hatch
33:00 Richmond’s origin story
34:00 Why cost seg is tax code, not a loophole
38:00 100% bonus depreciation and the One Big Beautiful Bill
44:00 The January 19, 2025 line in the sand
47:00 Form 3115 catch-up for 2022–2024 properties
52:30 ROI: $7K spend, $400K in tax savings
54:00 What’s next for the industry
About the Guest
Richmond Stacker
Founder & CEO | USA Cost Segregation
Richmond is Founder & CEO of USA Cost Segregation, a national engineering-led cost seg firm. A former mortgage broker who taught himself the tax code, he built his first proprietary cost seg software in 2019 and runs a team known for fast turnarounds and candid advisory — including telling clients when NOT to do a study.
Contact: [email protected] | usacostsegregation.com
Keywords
Primary
cost segregation • 100% bonus depreciation • One Big Beautiful Bill • OBBBA • real estate tax strategy • bonus depreciation permanent
Secondary & Long-Tail
Section 168(k) • depreciation recapture • 1031 exchange • real estate professional status • Form 3115 • short-term rental loophole • QIP expensing • accelerated depreciation • USA Cost Segregation • Richmond Stacker • cost seg for 2022–2024 acquisitions
Tags
real estate, passive income, tax strategy, cost segregation, bonus depreciation, real estate investing, commercial real estate, tax planning
Disclaimer
Educational purposes only — not tax, legal, or investment advice. Consult your CPA and a qualified cost segregation firm before initiating a study.
