Legal Definitions - possessory interest

Possessory interest

Possessory interest refers to the right of an individual to occupy or possess a piece of property, even though they do not own it. This means that the person has some present right to control the property, such as a lease or rental agreement.

For example, if you rent an apartment, you have a possessory interest in the property. You have the right to live there and use the space, but you do not own the apartment.

Possessory interest can also arise in situations where a person or entity has temporary use of government-owned property. In these cases, the possessory interest may be taxable.

For instance, if a business is granted a possessory interest in a piece of government-owned land to build a parking lot, they may be required to pay taxes on the value of that interest.

Overall, possessory interest refers to the right to possess and control property, even if you do not own it outright.