I am purchasing a business that is located in a leased property. The seller made leasehold improvements to the property. The seller wants me to "purchase" these improvements as part of the business sale.
Unfortunately, an improvement made by the lessor does not qualify as qualified leasehold improvement property to any subsequent owner unless it is acquired from the original lessor by reason of the lessor's death or in one of the types of transactions listed in the reference below.
See the specific rules under Qualified Leasehold Property (IRS Pub 946): Which Property Class Applies?