Consider Lease To Own

Published September 23, 2025

The US IRS generally requires the cost of a domain name to be capitalized as an intangible asset under Section 263.

The price paid for a domain name is generally amortized over a 15-year period under Section 197, meaning the tax deduction is spread out.

3 Potential Buyer Benefits of a Domain Name Lease To Ownership

Lease to ownership allows you the option of rights at an earlier point in time versus waiting until you are able to pay the upfront price.
A lease to ownership preserves cash flow by avoiding one large upfront payment, providing financial flexibility to invest in other growth opportunities or operational needs.
Lease to ownership may reduce long-term financial risk by allowing flexibility to exit or change domain name agreements without the full investment commitment.

Steady and predictable income stream from lease payments, which provides financial flexibility and ongoing revenue.
Potential tax advantages by spreading revenue over time rather than receiving a lump sum, depending on tax classification and consultation with an accountant.
Opportunity to realize a higher total sale price if structured with a lease to ownership agreement.