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Cost segregation for Airbnb and short-term rentals

Short-term rentals play by different tax rules. Our study turns the furniture and fixtures you already own into a year-one deduction.

How short-term rental investors use bonus depreciation

If your guests stay 7 days or less on average, the tax code treats your rental as a business, not a passive investment. Three things follow from that. The 7-day rule

  • 100% bonus depreciation

    Qualified property acquired and placed in service after January 19, 2025 gets 100% bonus depreciation. The short-life assets the study identifies are deducted in full in year one. Bonus depreciation on furnished rentals

  • Furnished means more to itemize

    Beds, sofas, appliances, window coverings, and decor depreciate over 5 years instead of 27.5. Every component is listed individually with its cost source, so a furnished rental moves more of its basis into year one. How furnishings are classified

  • Losses that offset W-2 income

    Non-passive losses can offset ordinary income, including your salary. Cost segregation is what makes the year-one loss large enough to matter. Offsetting W-2 income

Offset W-2 income with the STR Loophole

Rental losses normally stay with rental income. Short-term rentals are the exception, which is why the strategy is a favorite of high-income W-2 earners: the higher your bracket, the more each dollar of deduction is worth.

  1. Average stays of 7 days or less

    The tax code treats your rental as a business, not a passive investment. Learn more

  2. Material participation

    Run it yourself for 100+ documented hours a year, more than anyone else, and your CPA may treat it as non-passive. Learn more

  3. Losses offset your salary

    A cost segregation study creates the year-one deduction. Non-passive, it can offset W-2 wages. Learn more

Estimated year-one tax savings on a $500,000 short-term rental with $100,000 of short-life assets

$38,818 back in your pocket

Example only. Assumes 100% bonus depreciation and that your CPA confirms non-passive treatment. Individual results vary.

Your short-term rental has hidden tax benefits

Common short-term rental amenities put more tax savings in your pocket than other rental properties. Our cost segregation study helps you claim these benefits.

  • Furnished listings

    Claim the full value of beds, sofas, appliances, window coverings, carpet, and decor.

    Typical tax deduction

    $25,000+

  • Pools and patios

    Claim the full value of pools, pool equipment, spa basins, decks, patios, fencing, and other land improvements.

    Typical tax deduction

    $50,000+

  • Movie and game rooms

    Does your rental have unique equipment? We help you deduct projectors, screens, seating, arcade and game equipment. We've seen it all!

    Typical tax deduction

    $15,000+

  • Saunas and hot tubs

    Saunas and hot tubs are not only guest favorites, they are tax savings.

    Typical tax deduction

    $3,000+

Typical figures, deducted in full in year one under 100% bonus depreciation. Your property's components, condition, and local costs set your own result; your CPA confirms eligibility.

Short-term rental investor guides

The rules, the tests, and the filings, explained.

All articles

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Cost segregation studies for residential investment property and short-term rentals.

Itemized asset schedule

Every component is listed with quantity, cost source, and valuation

Full depreciation schedule

Year by year MACRS depreciation schedule

CPA-ready executive summary

Formatted for your CPA to work from at filing

Delivered in 3 to 5 business days

Submit your documents and get your completed report

Virtual study
$2,200 per study

No fees. Taxes included.

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3 or more properties? 10% off every study

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Included at no extra cost

While other firms keep up-charging, we focus on quality service at one inclusive price.

  • Audit support

    Audit support

    If the IRS questions your study, we respond at no additional cost. What Audit Support covers

    Included

  • Renovation invoices

    Renovation invoices

    Send us your invoices and construction documents for even more deductions.

    Included

  • Form 3115 catch-up

    Form 3115 catch-up

    Bought in a previous year? Catch up on missed depreciation without amending prior returns.

    Included

  • Tax assessment record search

    Tax assessment record search

    No appraisal? We pull the county tax assessor’s record to source your land value.

    Included

  • Revisions

    Revisions

    Forgot a document? Send it within one week of receiving your study and we revise it.

    Included

How we compare

With other firms, you'll pay more upfront, or in hidden costs later.

Price

Our study
$2,200 flat, published
Traditional firms
Quote-based sales process, often $5,000+
DIY & budget tools
Low, but self-service

Who does the work

Our study
US-based team of engineers
Traditional firms
Engineers
DIY & budget tools
DIY, AI, or foreign contractors

Turnaround

Our study
3 to 5 business days
Traditional firms
4 to 8 weeks
DIY & budget tools
Instant

Site visit

Our study
Completely virtual
Traditional firms
Sometimes required
DIY & budget tools
None

Documentation

Our study
Every component, with its cost source
Traditional firms
Full report
DIY & budget tools
Summary only

Audit support

Traditional firms
Varies

Short-term rental questions

What Airbnb and VRBO hosts ask before ordering a study.

Does my Airbnb qualify for the short-term rental loophole?

Two tests decide it. First, the average guest stay has to be 7 days or less. Second, you have to materially participate, which usually means more than 100 documented hours a year and more than anyone else who works on the property. Meet both and the IRS may treat the rental as non-passive, so its losses can offset your W-2 income. Your CPA confirms whether you qualify. Our study gives them the depreciation numbers to act on. Read more on the 7-day rule and material participation.

Do you itemize the furniture and appliances in my Airbnb?

Yes. Every component is listed individually, with its quantity, cost source, and valuation. For a furnished short-term rental that means beds, sofas, appliances, window coverings, and decor, each on its own line as 5-year property. That is where a furnished rental pulls ahead of an empty one: more identified components means more of your basis moved into short-life classes and deducted in year one.

Can I use my Airbnb listing photos for the study?

Please do. After you book, we email you a short checklist: a closing document, photos, and your appraisal and inspection report if you have them. Your listing link is the ideal photo source because it shows the property furnished and staged, room by room. Send the link and we take it from there. If you also have an inspection report from closing, include it. It lists appliance makes, models, and ages that let us itemize more.

What if I bought the property already furnished?

Tell us, and we account for it. When furnishings come with the purchase, they are part of what you paid, and the study identifies and values them from your photos and documents like any other component. If you furnished it yourself afterward, send the receipts. Improvements placed in service in a different year are scheduled separately, with the right convention for each, at the same flat fee.

I placed my Airbnb in service this year. When should I order the study?

Any time before your CPA files. Bonus depreciation on the short-life assets the study identifies is claimed for the year you place the property in service, and it is 100% for property acquired and placed in service after January 19, 2025, so ordering before year-end tax planning gives your CPA the most room to work. We deliver in 3 to 5 business days, so there is no need to order months ahead. Bought it in an earlier year? A look-back study catches up on the depreciation you missed.

Does this work for a VRBO, a condo, or a cabin?

Yes. The platform does not matter and neither does the property type, as long as it is held for rental use rather than as your personal residence. Single-family homes, condos, townhomes, cabins, and multi-unit properties all qualify. For a condo, the study covers the unit and what you own inside it. How condos are handled.

Your rental is already furnished. Let it earn its deduction.

Every sofa, bed, and appliance, itemized and ready for your CPA.

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Audit support includedAudit support included Engineering you can verify US-based team of engineers