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Sunday, July 26, 2015

Importance of lease terms for desired results

A recent Tax Court case serves as a reminder on a few items:
  • If you want a particular tax result, be sure the lease agreement supports that result.
  • Section 467 is tricky (and complex).
  • Preparers need to be sure clients have and take sufficient time to review their return before signing. They should be asking the preparer questions where something is not clear, confusing or missing.
I've got a short article on the case - Stough, 144 T.C. No. 16 (2015), in the 8/16/15 AICPA Tax Insider - Is it rent? That depends on the lease.

What do you think?

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