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jds24
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Lease Buyout received by landlord

My commercial tenant wishes to vacate 3 years early and is offering a lump

sum payment. Is that payment ordinary income or capital gain?

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1 Reply

Lease Buyout received by landlord

Ordinary income but may be amortizable.

 

See https://www.thetaxadviser.com/issues/2007/nov/leaseterminationpayments.html

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