To whom should the Creative World School tenant directly pay real estate taxes?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
- 2.2 Real Estate Taxes. Tenant shall pay as additional rent during the term of this Lease all general ad valorem real estate taxes and assessments (collectively "Taxes") imposed or assessed against the leased premises during the term of this Lease. Taxes for any tax year or other period only a portion of which falls within the term of this Lease shall be prorated between Landlord and Tenant based on the portion of such tax year or other period falling within the term of this Lease. Tenant may pay any Taxes in installments, if permitted by the taxing authority and shall only be responsible for such installments as become due during the term of this Lease. Tenant shall pay such Taxes, before delinquent, directly to the taxing authority. Tenant may contest in good faith by appropriate proceedings any Taxes assessed against the leased premises. Tenant hereby agrees to pay and discharge the contested Taxes as finally determined, together with any interest or penalties thereon. Landlord shall join in any such proceedings, and hereby agrees that the same may be brought in its name, if required by applicable law and regulation. In addition, Landlord agrees to cooperate with Tenant in such proceedings to the extent reasonably necessary or appropriate for Tenant to reasonably proceed with such contest. Tenant shall be entitled to any refund of any Taxes paid by it.
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
According to the 2025 Creative World School Franchise Disclosure Document, the tenant is responsible for paying real estate taxes directly to the taxing authority. As additional rent, the tenant must pay all general ad valorem real estate taxes and assessments (referred to as "Taxes") imposed on the leased premises during the lease term. If the tax year only partially falls within the lease term, the taxes will be prorated between the landlord and the tenant based on the portion of the year covered by the lease.
The tenant has the option to pay these taxes in installments if the taxing authority permits it, but they are only responsible for the installments that become due during the lease term. It is the tenant's responsibility to ensure these taxes are paid before they become delinquent. Furthermore, the tenant has the right to contest any taxes assessed against the leased premises through appropriate proceedings, provided they do so in good faith.
If the tenant chooses to contest the taxes, they must ultimately pay and settle the contested taxes as determined, including any interest or penalties. The landlord is obligated to cooperate in these proceedings and may be required to allow the proceedings to be brought in their name if necessary under applicable laws. Any refunds of taxes paid by the tenant will be entitled to the tenant.