The value of leasehold improvements made by the lessee is nontaxable to the lessor at the time made and at the time of lease termination unless they were made in lieu of rent.

Question

Quizplus · Accepted Answer

Leasehold improvements made by the lessee are not considered taxable income to the lessor unless they are made in lieu of rent. This means that the lessee cannot deduct the cost of the improvements as a business expense and the lessor does not have to recognize the value of the improvements as rental income.

The Value of Leasehold Improvements Made by the Lessee Is