Principal Balance. (1) In general. Except as provided in paragraph (b)(2) of this section or in § 1.467–7(e), (f), or (g), the principal balance of the section 467 loan at the beginning of a rental pe- riod equals— (i) The fixed rent accrued in pre- ceding rental periods; (ii) Increased by the sum of— (A) The interest on fixed rent includ- ible in the gross income of the lessor for preceding rental periods; and (B) Any amount payable by the lessor on or before the first day of the rental period as interest on prepaid fixed rent; and (iii) Decreased by the sum of— (A) The interest on prepaid fixed rent includible in the gross income of the lessee for preceding rental periods; and (B) Any amount payable by the lessee on or before the first day of the rental period as fixed rent or interest thereon.
Appears in 14 contracts
Samples: Lease Agreement, Rental Agreement, Rental Agreement
