5-Year, 7-Year, and 15-Year Property: Full Example List

The three reclassified classes at a glance

There is no 9-year property class in cost segregation. If a tool or calculator quotes one, that is not how the IRS's own component classification framework, described in its Audit Techniques Guide (Pub 5653), is built. The four rows above are the whole list.

5-year property, the full example list

• Carpet and most flooring
• Decorative lighting fixtures
• Cabinetry
• Appliances
• Window treatments
• Certain electrical and plumbing that serves specific equipment rather than the whole building

This is usually the largest reclassified bucket by dollar volume on interior-heavy properties like restaurants, medical offices, and multifamily. A medical clinic benchmark study identified $241,839 in first-year deductions against a $1,404,500 building basis, a large share of it driven by finishes, cabinetry, and equipment-serving electrical and plumbing typical of clinical space. See what gets reclassified in a cost segregation study for the room-by-room walk.

7-year property, the full example list

• Certain fixtures
• Certain furniture

This class is narrower than 5-year and 15-year in most commercial buildings; an engineer confirms which fixtures and furniture actually qualify in a given property rather than assuming a blanket rule applies. It shows up most often in properties with built-in seating, millwork, or furniture systems installed as part of the original construction rather than brought in later by a tenant.

15-year land improvements, the full example list

• Paving and curbs
• Fencing and gates
• Landscaping and irrigation
• Site utilities
• Outdoor and parking lot lighting
• Pools and patios

See the full site improvements page for how this category performs on retail and industrial sites with large lots, where it is frequently one of the biggest single reclassified categories on the whole property.

What stays on the 39-year (or 27.5-year) schedule

Foundation, framing, exterior walls, windows, the roof structure, core plumbing and electrical serving the whole building, and central HVAC. None of it is a 5-year, 7-year, or 15-year class; it is what remains after the other three classes are pulled out. A structural roof and a building's central HVAC are the two components most often assumed to be 5-year property; they are not. See what stays on the 39-year schedule for the complete inventory, and the dedicated pages on roofs and HVAC for the mechanics that do apply to each.

How the mix shifts by property type

A cost segregation study typically moves about 15 to 35% of building basis into the three faster classes, and where a specific property lands in that range depends on construction, not on a fixed formula. Restaurants and hospitality-heavy buildings run at the high end because of kitchen equipment, finishes, and decorative elements. Plain shells like warehouses run at the low end. In one delivered restaurant study, first-year deductions came to $599,678 against a $2,804,440 building basis, just over 21% of basis in year one, consistent with the high end of that range. A warehouse and office building in the same benchmark set identified $330,674 in first-year deductions on a $1,911,675 basis, about 17%, without a kitchen or heavy finish package behind it. See how much of a building can be reclassified for the full property-type breakdown.

How to use this list on your own building

This page is meant to be a checklist, not a promise. Walk your own building against the three lists above: what flooring, cabinetry, and lighting is actually installed, what fixtures and furniture were built in rather than brought by a tenant, and what paving, fencing, and landscaping sits on the site. That walk gives a rough sense of where a building is likely to land, but only an engineering-based study, checking each component against actual construction and cost records, produces a number that would hold up if an examiner ever asked to see the work behind it.

Two properties with the same square footage and the same use can land in very different places on these lists depending on how they were built out. A ground-floor retail space with a full kitchen build-out reclassifies differently than an identical footprint used as plain office storage, even though the shell, foundation, framing, roof, and central HVAC, looks the same on paper for both.

Why bookmark this page

Owners, CPAs, and bookkeepers use a page like this one as a quick reference when a new invoice or a renovation line item comes in and the question is simply which class it belongs to. It is not a substitute for the engineering work behind an actual study, but it answers the everyday version of the question fast: is this thing 5-year, 7-year, 15-year, or shell.

The two components that trip up quick answers

Two items get guessed wrong more than any others on a page like this: the roof and the central HVAC system. Both look expensive enough to belong in a faster class, and both are structural in every correctly run study. See is a roof 5-year property and is HVAC 5-year property for the full explanation of why, and for the section 179 and partial asset disposition mechanics that actually do apply to each of them.

Frequently asked questions

Is flooring always 5-year property?

Most flooring is, but the actual construction still matters; an engineer confirms the specific material and installation rather than assuming every floor in every building qualifies the same way, and rare exceptions do exist depending on how a floor is finished or installed.

What is an example of 7-year property in a commercial building?

Certain fixtures and furniture, a narrower category than 5-year or 15-year in most buildings. Which specific items qualify depends on the property and how they are installed, which is why this class is confirmed component by component rather than assumed.

Is a parking lot 15-year or 39-year property?

15-year. Paving, curbs, and the lot's own lighting are land improvement property, separate from the 39-year (or 27.5-year residential) structural shell that houses the building itself. On a large retail or industrial lot, this single category can add up to real dollars.

Is there really no 9-year property class in cost segregation?

Correct, there is no 9-year class. The recognized classes are 5-year, 7-year, 15-year land improvements, and the 39-year or 27.5-year structural shell. Any tool suggesting a 9-year bucket is not following the IRS's own classification framework.

Does the mix of classes change by property type?

Yes. Restaurants and hospitality properties typically reclassify a larger share of basis because of kitchen equipment and decorative finishes; simple shells like warehouses reclassify a smaller share because there is simply less personal property and fewer land improvements present.