Approaching Extension Deadlines: Unearthing Overlooked Deductions in Real Assets, R&D and Energy Efficiency

As we draw near to the September and October extended tax filing extension deadlines, many investors and operating companies assume the window for meaningful tax optimization has closed. In reality, the post-filing period can be one of the most productive times to reassess credit and deduction opportunities that were missed in the rush.

From accelerated depreciation on real assets, to R&D credits inside portfolio companies, to energy-efficiency deductions tied to new construction or retrofits, a surprising number of strategies remain underutilized across commercial real estate.

Dr. Dan Boyd, VP and sales leader for CSSI Services, the nation’s leading cost segregation and specialty tax firm, shares where the biggest gaps are between what the tax code allows and what organizations claim, and how smarter year-round planning can translate directly into higher after-tax returns.

“One of the biggest [missed opportunities] is that they haven’t used the strategies that are already there for people who own real estate,” Boyd said. “The big one is cost segregation [the idea that things that wear out quickly should be depreciated quickly] … they don’t look into it because it’s expensive or the ROI isn’t great.”

That perception, he added, is frequently misplaced. “I’m constantly surprised that when I speak with tax professionals or investors, their initial impression is that it is exorbitantly expensive, and then they’re shocked to realize there’s tens if not hundreds of thousands of dollars of tax savings for them at a fraction of that cost,” Boyd said. His advice is straightforward: “Let somebody show you how much there is for you or what’s the ROI.”

Why Cost Segregation Remains Underutilized

Despite being a well-established strategy, accelerated depreciation remains underutilized. Boyd attributes that in part to an education gap. “If a CPA went to school before 1997, cost segregation wasn’t part of their schooling,” he said. “Since then, unless they’ve gone to a professional development, they’re not going to have updated information.”

At the same time, the strategy has become far more accessible. “Initially it was going to be the exclusive domain of $300 million hospitals, hotels and skyrises,” Boyd said. “But as time has gone on, we’ve been able to make this make sense for people who own $200,000 condos. Now it’s [largely] available for any real estate investor.”

Shifting to Year-Round Tax Strategy

Boyd emphasized that tax optimization should not be treated as a once-a-year exercise. “The best time to look into a cost segregation is before you buy the property,” he said. “Most people are weighing investments based on their potential to perform. One of the things they can factor into that decision is how much additional depreciation will it generate.”

That forward-looking approach can materially impact underwriting. “We routinely do preliminary analyses for people before they even buy real estate so they can get an idea of which one will give them the greatest deductions,” Boyd said. Still, for those who already own assets, the window remains open. “It’s still never too late,” he added. “We’ve done studies on buildings that are decades old.”

Even within a given tax year, timing flexibility exists. “Let’s say you acquire a property in early 2026—you’re not going to file taxes for almost 12 months, maybe longer” Boyd said. “You can still do the cost segregation now so that you have the results and more accurately calculate your quarterly estimates.”

A Dumpster Full of Cash, Not Trash

Asset selection also plays a role in tax efficiency. “In general, the more inside and outside the building, in terms of site improvement, the better it’s going to perform,” Boyd said. “On the low end of the spectrum is warehouse… most of it is structural.” By contrast, “multifamily and self-storage do very well,” while “anything with a lot of parking tends to do very well, as does hospitality.” Industrial and manufacturing assets can also generate meaningful benefits due to the number of components involved.

Energy-efficiency incentives and renovation strategies can further enhance returns. Boyd pointed to scenarios where investors combine cost segregation with redevelopment. “Maybe 20% to 25% of the building cost would be realized as a deduction,” he said, adding that subsequent renovations can unlock additional value through Partial Asset Disposition. “There’s lots of tax value in those components you’re throwing away, and if you don’t take advantage of it, it’s gone forever.”

“The image that everyone needs to keep in mind is that when there’s a dumpster outside you building, that dumpster is full of cash, not trash,” Boyd added.

For Boyd, the key takeaway is early and ongoing engagement. “Anytime anyone is looking to purchase a building, I think it makes sense to ask for a preliminary estimate,” he said. “You can involve it in your underwriting process to understand that full cycle of financial flows.”

Stable Policy Backdrop Supports Planning

Looking ahead, Boyd sees a stable policy backdrop supporting these strategies. “The waters are calm right now—we’re not seeing anything being debated,” he said. He also pointed to the permanence of bonus depreciation as a tailwind. “The 100% bonus… was made a permanent part of the tax code. Barring some change in sentiment, it’s here to stay, which is good.”

A Reset for Smarter Planning

Ultimately, Boyd framed post–Tax Day not as a conclusion, but as a reset point for more disciplined planning. Investors who revisit their portfolios, engage specialists earlier in the deal lifecycle and incorporate tax considerations into underwriting decisions stand to meaningfully enhance after-tax returns. In an environment where yield compression and cost pressures remain top of mind, capturing these overlooked tax efficiencies can serve as a critical, and often underappreciated, source of incremental performance.