July 23, 2020
Our lease agreement requires us to pay for the entire year in one lump sum ($250,000 a year). So, if this is paid during the period, must this be broken down by month or can the entire payment be used in the calculation?
Posted by Armanino Financial Advisory Team
You cannot use the entire payment in your rent costs calculation. That is effectively a pre-payment, which are expressly not allowed. You will need to pro-rate the lump sum payment for the length of your Covered Period.