Leasehold Improvements (sometimes referred to as "build-outs") are the structural changes you make to leased space to make it suitable for your business needs. For example, lighting changes, a reception area, offices, dressing rooms, and other special rooms or partitions might be needed, as well as paint and carpeting/flooring. These costs may be paid by the landlord (and included in your monthly rent) or you may be able to make some changes yourself and save money.
Leasehold improvements are assets, and they may be depreciated. Keep information on the cost of leasehold improvements for your tax advisor.
