Leasehold improvements

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Subject Author Date Leasehold improvements Dick Adams 09-29-2009  Re: Leasehold improvements paulthomascpa 09-30-2009  Re: Leasehold improvements HLunsford 09-30-2009  Re: Leasehold improvements Stuart A. Bronstein 09-30-2009  Re: Leasehold improvements Gene E. Utterback, EA, RF... 10-01-2009  Re: Leasehold improvements Stuart A. Bronstein 10-01-2009  Re: Leasehold improvements Dick Adams 10-01-2009  Re: Leasehold improvements Stuart A. Bronstein 10-01-2009  Re: Leasehold improvements Dick Adams 10-01-2009  Re: Leasehold improvements Arthur Kamlet 10-01-2009  Re: Leasehold improvements Dick Adams 10-01-2009  Re: Leasehold improvements Seth 10-01-2009  Re: Leasehold improvements Dick Adams 10-04-2009  Re: Leasehold improvements Seth 10-04-2009  Re: Leasehold improvements Seth 10-01-2009  Re: Leasehold improvements Stuart A. Bronstein 10-01-2009  Re: Leasehold improvements Mark Bole 10-02-2009  Re: Leasehold improvements Stuart A. Bronstein 10-02-2009  Re: Leasehold improvements Seth 10-02-2009  Re: Leasehold improvements Seth 09-30-2009  Re: Leasehold improvements HLunsford 10-01-2009  Re: Leasehold improvements Stuart A. Bronstein 10-01-2009  Re: Leasehold improvements HLunsford 10-02-2009  Re: Leasehold improvements Stuart A. Bronstein 10-02-2009  Re: Leasehold improvements HLunsford 10-03-2009  Re: Leasehold improvements Stuart A. Bronstein 10-03-2009
Posted by Stuart A. Bronstein on October 1, 2009, 3:14 pm Please log in for more thread options >> >> As I recall there was a provision in the tax code (is it still >> there?) that says leasehold improvements made by a tenant but >> benefit the landlord at the end of the lease, are not taxed to >> the landlord. > > I really want to be Stuart on this one - the only increase you > should get in basis would be due to any income you reported as a > result of the improvement. > > However, I'm not sure about this. Please not that I said NOT > SURE, because I'm not. I'd want to research it get an answer > you could rely on, but I am concerned about: IRC §109 says, in full, "Gross income does not include income (other than rent) derived by a lessor of real property on the termination of a lease, representing the value of such property attributable to buildings erected or other improvements made by the lessee." As far as basis, that's dealt with in regulation §1.1019-1. It says that if a lessor would have had taxable income but for §109, there is no change in basis to the property. That will be $150. > 1 - windfall benefit. If you buy a desk for $100 and find an > original Monet in one of the drawers isn't there some windfall > tax that you'd be responsible for? Would this impact basis? If it's not cash, are you taxed when you find it, or when you sell it? > 2 - what about those home improvement shows, where they fix up > or completely rebuild a home. I believe that the value of these > improvements is considered income to the home owners, in which > case if they paid tax on it, it should add to basis. I'd imagine that it could be structured to be fully tax free. If the show leases the property from the owner for 14 days or less, any lease payments are tax free to the homeowner. §208A. Then based on §109, the improvements would also be tax free. They do not increase the basis, however, so the taxpayer would end up being taxed on the improvements when the property is sold. > 3 - is there any argument that the house WOULD have rented for > more had it had a garage and it was rented for less under the > condition that the garage be built and transferred to the owner > upon termination of the lease? I think this is similar to > Harland's position, which I think may have merit. Apparently not. -- Stu http://downtoearthlawyer.com -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Dick Adams on October 1, 2009, 8:19 pm Please log in for more thread options > IRC ?109 says, in full, > > "Gross income does not include income (other than rent) derived by > a lessor of real property on the termination of a lease, > representing the value of such property attributable to buildings > erected or other improvements made by the lessee." > > As far as basis, that's dealt with in regulation ?1.1019-1. It > says that if a lessor would have had taxable income but for ?109, > there is no change in basis to the property. > > That will be $150. That settles it as far as I am concerned. >> 1 - windfall benefit. If you buy a desk for $100 and find an >> original Monet in one of the drawers isn't there some windfall >> tax that you'd be responsible for? Would this impact basis? > If it's not cash, are you taxed when you find it, or when you > sell it? Even I know this one. It's Treasure Trove covered in Pub 525: "If you find and keep property that does not belong to you that has been lost or abandoned (treasure-trove), it is taxable to you at its fair market value in the first year it is your undisputed possession." Dick -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Stuart A. Bronstein on October 1, 2009, 9:02 pm Please log in for more thread options rdadams@panix.com (Dick Adams) wrote: >> If it's not cash, are you taxed when you find it, or when you >> sell it? > > Even I know this one. It's Treasure Trove covered in Pub 525: > "If you find and keep property that does not belong to you that > has been lost or abandoned (treasure-trove), it is taxable to > you at its fair market value in the first year it is your > undisputed possession." Thanks. I don't run across this kind of thing often, so probably won't remember it next time either. -- Stu http://downtoearthlawyer.com -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Dick Adams on October 1, 2009, 9:49 pm Please log in for more thread options > rdadams@panix.com (Dick Adams) wrote: >>> If it's not cash, are you taxed when you find it, or when you >>> sell it? >> Even I know this one. It's Treasure Trove covered in Pub 525: >> "If you find and keep property that does not belong to you that >> has been lost or abandoned (treasure-trove), it is taxable to >> you at its fair market value in the first year it is your >> undisputed possession." > Thanks. I don't run across this kind of thing often, so probably > won't remember it next time either. I remember it because it has come up here often and because Pub 525 says what is and is not income! Dick - Who hasn't prepared a tax return since 1980 and then it was part of the con job I was running on Susan to convince her I was a good deal! -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on October 1, 2009, 9:42 pm Please log in for more thread options > >Even I know this one. It's Treasure Trove covered in Pub 525: > "If you find and keep property that does not belong to you that > has been lost or abandoned (treasure-trove), it is taxable to > you at its fair market value in the first year it is your > undisputed possession." Unless the found trove is a record setting baseball, and the IRS commissioner suddenly finds himself in the middle of a PR disaster. http://quicktime.cnnsi.com/baseball/mlb/news/1998/09/08/irs_62_update/ -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Energy Improvements to Rental Property January 8, 2007, 9:39 pm Home office: Depreciate or expense improvements December 20, 2006, 9:52 pm 1040D Real Estate Sale/Gain-Improvements... 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