Stratum Cost Segregation

Cost segregation construction soft costs implementation guide

Project costs include design, permits, oversight and other indirect amounts. Work through nine focused checks before accepting a conclusion.

Educational implementation guidance. The records organize a review; they do not determine eligibility, deductions or savings.

When this guide is useful

Project costs include design, permits, oversight and other indirect amounts.

The distinction that matters

Keep the source costs and allocation method visible. Indirect costs should not vanish from the total or be assigned solely to maximize a desired deduction.

A worked situation to investigate

A new rental project has architect, permit and construction management invoices separate from the builder's contract.

The example is illustrative. Begin with the underlying event and its source documents, then separate missing facts from disagreements about their treatment. Work through the checks below in the order that matches your file, rather than treating a completed checklist as a tax conclusion.

Build a traceable handoff

Identify the affected person, entity or property and the relevant period. Keep original evidence, corrections and the reviewer's written conclusion connected. If the facts change after review, preserve the earlier version and ask whether the change affects implementation.

Nine focused questions

Design invoice identification

Review the evidence, identify conflicts and record the next action.

Permit fee records

Review the evidence, identify conflicts and record the next action.

Management service detail

Review the evidence, identify conflicts and record the next action.

Financing cost separation

Review the evidence, identify conflicts and record the next action.

Cost pool inclusion rationale

Review the evidence, identify conflicts and record the next action.

Allocation basis evidence

Review the evidence, identify conflicts and record the next action.

Direct cost tie-out

Review the evidence, identify conflicts and record the next action.

Reviewer method acceptance

Review the evidence, identify conflicts and record the next action.

Final total reconciliation

Review the evidence, identify conflicts and record the next action.

Related decisions on this site

Cost segregation tenant improvement ownership

An improvement project involves landlord contributions, tenant payments and lease obligations.

Cost segregation source pool exclusions

Several items appear in the source file but may fall outside the study scope.

Continue with a related resource

These links serve different purposes: owner preparation, property records, AE-owned proposal education, illustrative scenarios or technical study records. Confirm the publisher and engagement scope for the work you need.

Rental closing cost allocation

AE property-owner preparation

Primary guidance and review limits

The cited guidance provides the rule context. The example and review workflow are educational illustrations prepared by Stratum Cost Segregation. Confirm the applicable tax year, entity facts, prior reporting, state treatment and any required elections with your qualified professional. An adviser may need more information than this file lists.

Published 2026-10-09. Educational resource by Stratum Cost Segregation.