The landlord may not recover the
unamortized cost of tenant improvements paid for by the landlord.
Instead, the taxpayer adds the
unamortized cost to the adjusted basis of retained intangibles (Sec.
Thus, Wichtel could choose to value its intangible assets at market value, which likely would be higher than
unamortized cost.
If a tenant had a five year lease and left at the end of three years, he would pay any
unamortized cost."
For acquired film libraries, an entity must disclose the amount of
unamortized cost that remains, the method of amortization, and the amortization period being used.
To ensure uninterrupted operation in the event of default, the operator agreed to transfer all daycare center assets and materials to any operator selected by the SFWMD at the
unamortized cost of original acquisition.
Section M-5C of this statement requires an adjustment to depreciation rates or the recognition of
unamortized cost as a current period loss.
In some circumstances, the good guy guaranty may even include certain non-monetary obligations (e.g., unperformed repair obligations) or require the guarantor to reimburse the landlord for transaction costs in connection with the lease, including the
unamortized cost of rent concessions, leasing commissions or tenant improvement allowances.
Although desirable, cancellation options are usually granted only to larger tenants since landlords typically want to lock in their tenants for as long as possible; they normally require the tenant to pay the
unamortized cost of the build-out, free rent and brokerage commissions plus some part of the remaining rent.
Revised carrying amounts should not exceed original carrying amounts (acquisition cost or
unamortized cost) before adjustments were made to reflect the disposal decision.
If the partnership completely disposes of the trade or business for which the costs are incurred (in the case of startup expenses) or liquidates (in the case of organizational expenses) before the 180-month period ends, any
unamortized costs are deductible at the time of the disposition or liquidation.
But they chose to amortize the retrofit of the space over 10 years, pledging to pay all
unamortized costs if they do not renew after the initial seven-year term (which is big $$!).
