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In the USA, you can deduct your business expenses (including building rental) from your profits for tax purposes. This creates a huge incentive to rent, as it's
by stephengillie 12y ago
In the USA, you can deduct your business expenses (including building rental) from your profits for tax purposes. This creates a huge incentive to rent, as it's basically free - the company is basically paying part of their tax payment to their landlord.
- lenzm 12y agoIt's not even close to free. It's X% cheaper where X is the tax rate the company is paying. eg. $10,000 in gross profit - 20% in taxes = $8,000 net profit $10,000 in gross profit - $1,000 rent = $9,000 - %20 taxes = $7,200 net profit The net rent was $800 instead of $1,000 but not free.