Cost of Getting a Lease

If you get a lease for business property, you recover the cost by amortizing it over the term of the lease. The term of the lease for amortization purposes includes all renewal options (and any other period for which the lessee and lessor reasonably expect the lease to be renewed) if less than 75% of the cost of getting the lease is attributable to the term of the lease remaining on the acquisition date. The term of the lease remaining on the acquisition date does not include any period for which the lease may later be renewed, extended, or continued under an option exercisable by the lessee.

Enter your deduction in Part VI of Form 4562 if you must file that form, or on the appropriate line of your tax return.

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