Improvements to Leased Property Made by a Lessee Are Includable

question 16

True/False

Improvements to leased property made by a lessee are includable in the lessor's gross income only if made in lieu of rent or if rent is reduced because of the improvements.

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Definitions:

Rectification

The correction of a mistake in an agreement that would have rendered the agreement impossible to perform.

Innocent Misrepresentation

A false statement made without knowledge of its falsehood, leading another to enter into a contract under mistaken beliefs, without intent to deceive.

Unilateral Mistake

An error made by one party in a contract, which may not automatically void the contract unless certain criteria are met.

Material Term

An essential clause or provision in a contract that significantly affects the rights and obligations of the parties involved.