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leaseback

   Also found in: Dictionary/thesaurus, Legal, Wikipedia 0.06 sec.
Leaseback
An arrangement where the seller of an asset leases back the same asset from the purchaser.

Notes:
The lease arrangement is made immediately after the sale of the asset with the amount of the payments and the time period specified. Essentially, the seller of the asset becomes the lessee and the purchaser becomes the lessor in this arrangement.

A leaseback arrangement is useful when companies need to untie the cash invested in an asset for other investments, but the asset is still needed in order to operate. Leaseback deals can also provide the seller with additional tax deductions. The lessor benefits in that they will receive stable payments for a specified period of time.

Also known as a "sale and leaseback."

Leaseback
A transaction that involves the sales of some property, and an agreement by the seller to lease the property back from the buyer after the sale.
leaseback
See sale and leaseback.


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? Mentioned in ? References in periodicals archive
 
According to generally accepted accounting principles (GAAP), because of the simultaneous 15-year leaseback, the entire pre-tax gain of $5 million would be recognizable over the life of the lease, rather than in the year of the sale.
Is the time right for a sale-leaseback? The current state of the ... by Levin, Gerald J. / Financial Executive
Four tests must be met for a leaseback to be considered valid.
Sale-and-leaseback of real property by Fink, Philip R. / The Tax Adviser
One strategy that could provide tax and financial advantages to both a corporation and its controlling shareholder is a sale and leaseback of real property in which the corporation sells real estate with a building on it to the shareholder, who, in turn, leases both back to the company.
Sale and leaseback of real property by Fiore, Nicholas J. / Journal of Accountancy
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