Basic and Non-Basic Tax Tips for Leasing Lawyers

Leases raise numerous tax issues. Attorneys advising landlords and tenants should be aware of the general tax aspects of leases and know of more complicated tax issues that may affect leases and be prepared to introduce those issues to experts in taxation of leases. This article covers basic tax aspects of leases, including the character and timing of rental income and rent deductions; the deductibility of tenant improvements; and the consequences to the landlords and tenants of lease terminations, including leases with tenant improvements. The article also introduces non-basic leasing topics, such as section 467 leases and loans and leases used in basic and complex section 1031 exchanges