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Purchaser's Depreciation Rights In Property Subject To A Lease, Michigan Law Review

Michigan Law Review

This Note argues that the purchase of property subject to a lease may produce several types of depreciable interests. Part I of the Note examines the requirements for depreciability and the role that depreciation plays in tax law. It concludes that even where the method set out by Congress also accommodates other goals, depreciation primarily provides a way to recover costs during a depreciable asset's income-producing life. Part II applies these principles to the task of determining whether improvements - for example, buildings on the property subject to the lease - are depreciable in the purchaser's hands. It concludes that …