Definition of "Leasehold improvement"

Clarence  Williams real estate agent

Written by

Clarence Williamselite badge icon

Fathom Realty

Upgrading made by a lessee to leased property. Examples are paneling and wallpapering. These improvements revert to the lessor at the expiration of the lease term. As improvement costs are incurred under an operating lease, the leasehold improvement account is charged. The leasehold improvement is amortized to expense over the shorter of the life of the improvement or the remaining lease term. If there is a lease renewal option and the prospect of renewal cannot be predicted with certainty, the amortization period should be the original lease term rather than the longer possible term. The amortization expense on a leasehold improvement is not tax deductible. Leasehold improvement is usually considered an intangible asset, because the lessee does not own the leased property.

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.
 

 

Popular Real Estate Terms

Using beams on an interim basis while a structure is being built. Reinforcing a building with supports. A property. ...

Net amount received when property is sold. It equals the selling price less outstanding mortgage balance less all costs incurred in connection with the sale. These expenditures include ...

Property taken over by the government because the owner has failed to pay taxes on it. The property may revert back to the owner when the taxes are paid. If not, the government may sell the ...

Act of being a conservator. ...

Small, early twentieth century, one-story house or cottage. ...

Air penetrating crevices in a structure. Penetration of water into the earth or through a structure. For example, water infiltrates the basement of a house causing it to be damp. ...

The metaverse definition can be described as a digital environment that is simulated through the use of augmented reality (AR), virtual reality (VR), and blockchain technology, combined ...

Listing Agreement A.K.A. Listing is basically a contract allowing a real estate agent or broker to list a home for sale and act as the home seller agent representing his/her interests ...

Adding a period of time onto another. An examples a mortgagor who successfully restructures his loan by tacking another five years onto the term. ...

Popular Real Estate Questions