Carl
Level 15

Business & farm

If renting the building, any property improvements done and paid for by the renter are still treated as a business asset and depreciated as such. Then in the future if the business is sold, those assets are included in the sale if the buyer is buying the business in the same location. Things get tricky if say, the owner of the business later moves out of a rented building they renovated. But you deal with it at that time.