Question: RealTime Rentals leases space on its Internet server. Its standard one-year lease agreement requires new customers to pay the first and last months rent upon

RealTime Rentals leases space on its Internet server. Its standard one-year lease agreement requires new customers to pay the first and last months’ rent upon signing the lease and a $500 deposit that is returned after the customer has been with RealTime for one year.

Identify the tax issue(s) posed by the facts presented. Determine the possible tax consequences of each issue that you identify.

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