How lump sum payment is taxed

I have been offered a lump sum buyout of my cellular tower lease on my property. I am a sole proprietor and have shown a net loss on my taxes for years. How would this lump sum payment be taxed by the IRS if I were to take it?

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Jul 23, 2011
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by: Tower Genius

Great question. Many of the buyout companies will tell you that you can do this as a real estate transfer. We do not believe that this has been challenged by the IRS yet, but we think that the general statements made by these lease buyout companies may be questionable. Also impacting your particular situation would be if your accountant was depreciating your property over a period of time. This is really a question that is best answered by your own CPA and before you would agree to any lease buyout deal, it would b best to give us a call to quickly review your deal and give you our opinion of it. If the deal is insufficient we could recommend reputable lease buyout companies for you to obtain some pricing from so you could compare your deal. Please give us a call, our initial consultation is free and it can only help you.

Tower Genius 888-313-9750

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