Which of following if included in a rental agreement is not protected by the IRS Safe Harbors Rules?

A) Changes in amounts paid determined by reference to price indices.

B) Reasonable rent holidays.

C) Periodic rent increases paid to a controlled corporation.

D) Increases in rent keyed to increases in the lessors operating costs paid to unrelated third parties.

E) Rents based on a fixed percentage of lessee receipts or similar amounts.

Transfer by a lessee of less than the entire interest in the leased property used a trade or business for more than a year generally is treated as a sublease giving rise to which of the following?

A) Ordinary income.

B) A sale of a capital asset.

C) A long-term capital gain.

D) A sale giving rise to capital gain under Section 1231 of the Code.

Under Code Sec. 1038, if the mortgagee reacquires a seller-financed property financed by a purchase money mortgage, as a result of a default by the mortgagor, the mortgagee:

A) Only recognizes gain on the reacquisition.

B) Recognizes neither the gain nor the loss on the reacquisition except to the extent of payments received in excess of gain reported on the original sale for periods prior to the reacquisition.

C) Only recognize the loss on the reacquisition.

D) Recognizes neither the gain nor the loss on the reacquisition.

The cost of improvements borne by the lessee but treated as rent is considered to be:

A) A shared cost and both the lessor and the lessee both are entitled to depreciation deductions.

B) A lessors cost and depreciable by the lessor.

C) A lessees cost and lessor has no depreciable interest in improvements paid for from rent.

D) A shared cost and neither the lessor nor the lessee is entitled to depreciation deductions.

E) None of the above.