Legal Definitions - rents, issues, and profits

The legal term rents, issues, and profits refers to all forms of income, revenue, or financial gain that arise from owning or possessing a piece of property. This comprehensive phrase encompasses not only money received for the direct use of the property (rents) but also any other benefits, products, or profits generated directly from the property itself or from activities conducted on it.

Here are some examples to illustrate this concept:

• Example 1: Residential Rental Property

  Imagine a property owner who owns a duplex. The monthly payments collected from the tenants living in each unit are clearly the "rents." If the owner also charges a separate fee for tenants to use a shared garage or coin-operated laundry facilities located on the property, the income from these additional services would also be considered part of the "issues and profits" because they are directly generated from the property's amenities and use.

• Example 2: Agricultural Land and Natural Resources

  Consider a large farm owner who cultivates corn and soybeans. The money earned from selling the harvested crops each season represents the "issues and profits" derived from the productive capacity of the land. Furthermore, if the owner leases a small section of their property to a local quarry for mineral extraction, the payments received from the quarry would be considered "rents" for the use of that specific portion of the land.

• Example 3: Commercial Property with Business Operations

  A small business operates a boutique hotel in a building it owns. The revenue generated from guests paying for rooms, dining services, and any event hosting held within the hotel's premises constitutes the "issues and profits" derived from the commercial use of that real estate. If the hotel also leases out a small retail space within its lobby to a gift shop, the income from that lease would be considered "rents."