Discussion:Business Renter does fix-up
From TaxAlmanac, A Free Online Resource for Tax Professionals
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
Discussion Forum Index --> Advanced Tax Questions --> Business Renter does fix-up
Discussion Forum Index --> Tax Questions --> Business Renter does fix-up
| 5 August 2008 | |
| First for me. I have a client that was moving business locations. They just rent. They spent over $20,000 to fix up a building that they were going to rent. They then moved into the building. Since they do not own the building that they spent the $20,000 on how is that money treated?
Thanks, Dusty | |
AnnabelleC (talk|edits) said: | 5 August 2008 |
| I'll give you a hint.
"Leasehold Improvements" | |
| 5 August 2008 | |
| Did the $20,000 improve the building's value to the landlord, or are the improvements only useful to the tenant? See Sec. 109 and Reg. 1.109-1 . If the improvements are made in lieu of rent, and ownership remains with landlord upon termination, then treat it as prepaid rent. However if it is not intended as rent, it appears that it is not income to the landlord, and it is simply leasehold improvements. | |
To join in on this discussion, you must first
log in.
