# catchupdepreciation.com

> A free Form 3115 §481(a) catch-up depreciation calculator for US real estate investors who already own income property and have not yet done cost segregation. Returns a Year-1 catch-up deduction estimate and federal tax savings in 30 seconds. Operated by Cost Seg Smart LLC ([costsegsmart.com](https://costsegsmart.com)).

## The 30-second answer

**Form 3115 §481(a)** lets a property owner claim every year of missed accelerated depreciation in a single tax year — no amended returns required. On a $500,000 residential rental bought in 2022 and held 4 years, the catch-up adjustment typically lands between **$60,000 and $120,000** in Year 1 deductions. At a 32% federal bracket, that's **$19,000–$38,000** in tax savings claimed at once. Pre-2025 bonus depreciation rates (60–100%) often make a lookback study more valuable than starting cost segregation today.

## What this calculator does

Five inputs (property type, purchase price, year placed in service, federal bracket, depreciation history) → returns:

- **Year-1 catch-up deduction** (the §481(a) adjustment amount)
- **Year-1 federal tax savings** (deduction × bracket)
- **Multiple vs. forward-only study** (typically 3–5×)
- **Verdict**: STRONG (clear win) or MAYBE (small at this hold length)

## When a lookback study IS worth it

- Held 3+ years and never done cost segregation
- Federal bracket 24%+ (the deduction must offset taxable income)
- Property still owned (sold properties require Form 1040X, not 3115)
- Placed in service 2018–2024 (highest bonus rates, biggest catch-up)
- Short-term rentals (28% reclass typical, vs. 18% for LTR)

## When it is NOT worth it (or won't work)

- Property already sold — 3115 doesn't apply, must use 1040X (3-year cap)
- Held under 2 years — catch-up is small; consider forward-only study
- 12% bracket — each $1 of deduction is only worth $0.12
- Primary residence — only income-producing property qualifies
- No taxable income to offset (unless real estate professional or material STR participation)

## Form 3115 vs Form 1040X (one-line summary)

| | **Form 3115 §481(a)** | **Form 1040X** |
|---|---|---|
| Returns to file | 1 (current year) | 1 per missed year |
| Years claimable | All prior years | Last 3 only |
| Audit profile | Routine (DCN 7) | Higher |
| Deduction in Year 1 | Full back-depreciation | Spread across years |

## Methodology (calculator math)

- **Building basis** = purchase price × 0.80 (excludes land)
- **Reclassification %** = property-type lookup: SFR/MF 18%, STR 28%, Commercial 30%
- **Years missed** = `2026 − year_placed_in_service − 1` (clamped 0–7)
- **Bonus rate** = year-specific (2018–2022: 100%, 2023: 80%, 2024: 60%, 2025: 40%, pre-2018: 50%)
- **Catch-up** = bonus_portion + (remaining × years_missed × 0.15) − straight_line_already_taken
- **Forward multiple** = catch_up / (reclass × bonus × 0.30), rounded

## Parent organization

catchupdepreciation.com is a vertical of **Cost Seg Smart** ([costsegsmart.com](https://costsegsmart.com)) — an automated cost segregation provider. Same team, same engineering methodology. This site estimates the catch-up; costsegsmart.com delivers the IRS-defensible 40+ page lookback study with the Form 3115 attachment, starting at $495.

## Sister sites in the network

- [costsegsmart.com](https://costsegsmart.com) — order an IRS-defensible study
- [costsegworthit.com](https://costsegworthit.com) — decision tool: should you do a study at all?
- [costsegregationreviews.com](https://costsegregationreviews.com) — comparison of 27 cost seg providers
- [costsegregationpricing.com](https://costsegregationpricing.com) — pricing across the industry

## Contact

- Email: support@costsegsmart.com
- Phone: (213) 444-2776
- Order a lookback study: https://costsegsmart.com/order/?utm_source=catchupdepreciation