Common use of Straddle Period Tax Allocation Clause in Contracts

Straddle Period Tax Allocation. To the extent permitted by law, CEC and the REIT shall elect to close the taxable year of each REIT Entity as of the close of the Effective Date. In the case of any Straddle Period, the amount of Income Taxes attributable to the portion of the Straddle Period ending on, or beginning after, the Effective Date shall be made by means of an actual closing of the books and records of such REIT Entity as of the close of the Effective Date; provided that in the case of Non-Income Taxes that are periodic Taxes (e.g., property Taxes) and exemptions, allowances, and deductions that are calculated on an annual basis (such as depreciation deductions), such Taxes, exemptions, allowances, and deductions shall be allocated between the portion of the Straddle Period ending at the end of the Effective Date and the portion beginning after the Effective Date based upon the ratio of (x) the number of days in the relevant portion of the Straddle Period to (y) the number of days in the entire Straddle Period.