Cost Segregation in Massachusetts
Every SmartCostSeg study is prepared online from the owner's documents, so a Massachusetts property is served exactly like one next door in Rhode Island, where the company is based: no site visit, no meeting, the analysis alone. This page says what that means for a Massachusetts rental or commercial building and shows an example computed by our engine.
Based in Rhode Island, Serving Massachusetts Owners
SmartCostSeg LLC, a Rhode Island limited liability company.
Our business address is "Westminster Square, 10 Dorrance St, Suite 700-4893, Providence, RI 02903".
Massachusetts owners send the same documents and receive the same study in the same dashboard; nothing about the process changes at the state line.
How a Massachusetts Study Is Prepared
You upload the settlement statement, the photographs and any report you have; the engine computes the three positions; our team checks the study before it is delivered to your dashboard. The rules below are federal, printed from their sources.
- Land cannot be depreciated. The costs of clearing, grading, planting and landscaping are usually part of the cost of land. Source: Treas. Reg. section 1.167(a)-2; IRS Publication 527 (2025), chapter 2, What Rental Property Can't Be Depreciated
- Under the general depreciation system, residential rental property is depreciated over 27.5 years and nonresidential real property over 39 years. The alternative depreciation system, which applies to some property, has longer recovery periods. Source: IRC section 168(c) and (g)(2)(C); IRS Publication 946 (2025), chapter 4
- Bonus depreciation can apply to property that has a recovery period of 20 years or less, as long as the property also meets the other tests, such as the original use or used property rule. That covers the 5 year, 7 year and 15 year components a cost segregation study identifies. It does not cover the 27.5 year or 39 year building itself. Source: IRC section 168(k)(2)(A)(i)(I)
Massachusetts' Own Rules
Some states add back bonus depreciation, so the savings shown throughout this site are federal. Your CPA applies Massachusetts' treatment to your return.
- Massachusetts does not adopt the federal bonus depreciation deduction of IRC section 168(k) for the personal income tax or the corporate excise; depreciation for Massachusetts purposes is computed without it. Source: M.G.L. c. 62 section 2(d)(1)(N); M.G.L. c. 63 section 30(4)(iv); Massachusetts Department of Revenue TIR 03-25 and TIR 26-4
Property Types the Engine Models
Two, three and four family houses, mixed use buildings, and small apartment buildings each have a page with the classes the estimate moves and an illustrative example.
An Example From Our Engine
An invented two family computed by the estimate engine for the inputs shown.
| Item | Amount |
|---|---|
| Land value | $105,000 |
| Building basis | $595,000 |
| Moved to the 5 year class | $99,960 |
| Moved to the 15 year class | $42,840 |
| Left on the 27.5 year life | $452,200 |
| Share of the building basis moved | 24% |
| First year depreciation without a study | $21,636 |
| First year depreciation with a study | $159,244 |
| Additional first year deduction | $137,608 |
| Conservative | Middle of the Road | Aggressive |
|---|---|---|
| $113,375 | $159,244 | $205,113 |
Less to land means more to depreciate, so a low land value is the aggressive land position.
Illustrative example computed by our estimate engine for an invented Duplex at 5 Fixture Street, Testville, ZZ 00000: purchase price $700,000, $105,000 assigned to land (15.0%), placed in service January 1, 2026, at the Middle of the Road position with 100% bonus. Results vary with property specifics and your tax situation.
The ZZ 00000 marker means invented: these figures are an illustration for the inputs shown, not a result for any real property.
Questions people ask
Do you visit the property?
- No. The study is modeled from your documents and photographs and says so; nobody comes to the building.
Can my CPA in Massachusetts use the study?
- Yes. The study is prepared for your tax advisor: the asset by asset detail and the authorities, in a file your CPA works from, and depreciation schedules by year are available on request.
Who is behind SmartCostSeg?
- SmartCostSeg LLC, a Rhode Island limited liability company. The About page names the team and the contact page reaches it.
The rules on this page were checked against their sources on October 1, 2026.
Ready when you are.
The wizard asks the questions for your property and routes it to the right lane.