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Simple English definitions for legal terms

synthetic lease

Read a random definition: guilty but mentally ill

A quick definition of synthetic lease:

A synthetic lease is a way to buy property where a lender creates a special company to buy the property and then leases it to the buyer. This allows the buyer to deduct the property's depreciation and the loan's interest for tax purposes, while keeping the asset and debt off their balance sheet. It's like renting a house, but instead of a landlord, there's a special company that owns the property.

A more thorough explanation:

A synthetic lease is a method of financing the purchase of real estate. In this type of lease, a lender creates a special-purpose entity that buys the property and then leases it to the ultimate user, usually a corporation. The lessee pays rent to the special-purpose entity, which uses the rent to pay off the loan. The synthetic lease is treated as a loan for tax purposes and as an operating lease for accounting purposes. This allows the lessee to deduct the property's depreciation and the loan's interest while keeping both the asset and the debt off its balance sheet.

For example, a corporation wants to buy a building but doesn't want to show the debt on its balance sheet. The lender creates a special-purpose entity that buys the building and leases it to the corporation. The corporation pays rent to the special-purpose entity, which uses the rent to pay off the loan. The corporation can deduct the property's depreciation and the loan's interest while keeping both the asset and the debt off its balance sheet.

synopsis | synthetic rule

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babycat
16:13
@shaquilleoatmeal: yeah but then you have to go to Boston :(
shaquilleoatmeal
16:14
uva too
shaquilleoatmeal
16:14
whats wrong w boston ;(
GOT PROMOTED YAY how do i tell law schools abt this?
like do i type up and separate doc and send as an attachment? how much do i write?
shaquilleoatmeal
16:15
@jackfrost11770: LFGGGG
TYYYYYY
shaquilleoatmeal
16:16
do any of your schools have updated sections in the portal? If so, i'd upload there, if not email. Small paragraph should do it id think
1a2b3c4d26z
16:16
Who wanna play some operation metro later on
1a2b3c4d26z
16:16
Congrats jack!
thank you!!
babycat
16:16
@jackfrost11770: personally I would submit an updated resume reflecting the new position instead of a paragraph but idk what SOP is
getting a bacon egg and cheese in celebration
1a2b3c4d26z
16:18
lfg baby you earned that
babycat
16:20
also congrats!! big win
initiallaw
16:23
congrats!!
:D
the big W is that i get reimbursed for travel now thank GOD
jack moving up in the world :)
i have a brother named jack, so whenever i see your name im marginally happier than normal
babycat
16:37
I'm guessing you don't have a sibling named babycat but I hope I still make you marginally happier than normal despite this
JumpySubsequentDolphin
16:38
maybe he has a babycat
babycat
16:38
I think everyone should have a babycat
JumpySubsequentDolphin
16:39
im allergic to baby cats >:(
JumpySubsequentDolphin
16:40
I used to have a babycat, I only got allergies after he died
JumpySubsequentDolphin
16:40
I think he’s haunting me
babycat
16:40
:(
babycat
16:40
that's too bad
babycat
16:40
you still have me though <3
@babycat: you make my day marginally happier with your scathing wit
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