Why residential rentals reclassify well in Pennsylvania
Pennsylvania straddles two major industrial markets — Philadelphia and Pittsburgh — and the Lehigh Valley logistics corridor. Multifamily, industrial, and adaptive-reuse all see heavy activity.
Residential Rental properties have a particular profile that makes cost segregation especially valuable: single-family rentals, small portfolios, flooring + appliances + site improvements. The shell sits on a 27.5-year recovery period under MACRS — but every residential rental is hundreds of components, many of which qualify for 5-, 7-, or 15-year recovery and accelerated bonus depreciation.
Typical reclassification ratio
For a residential rental in Pennsylvania, TDA studies typically reclassify 15–25% of depreciable basis. Combined with 100% OBBBA bonus depreciation on property acquired and placed in service after January 19, 2025, that translates the entire reclassified amount into a year-one deduction.
Pennsylvania markets we serve
We deliver residential rental cost segregation studies across Pennsylvania, including Philadelphia, Pittsburgh, Allentown, Erie, Reading. Engineering-based methodology and RSMeans cost data on every engagement.