Accommodation Party legal definition of Accommodation Party. Accommodation Party synonyms by the Free Online Law Dictionary.

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One who signs a Commercial Paper for the purpose of lending his or her name and credit to another party to the document—the accommodated party—to help that party obtain a loan or an extension of credit.

A person wanting to obtain a car loan, for example, may offer a finance company a promissory note for the amount of the requested loan, promising to repay the amount over a number of years. If the company does not consider the person a good credit risk (one who will be able to repay the loan), it will request that someone else sign the note to ensure that the company will be repaid. Such a person may be an accommodation endorser, because he or she endorses the note after it has been completed, or an accommodation maker, because he or she must sign the note with the accommodation party.

An accommodation party is liable to the person or business that extended credit to the

accommodation party, but not to the accommodated party. The accommodation party is liable for the amount specified on the accommodation paper. If an accommodation party repays the debt, he or she can seek reimbursement from the accommodated party.

? References in periodicals archive
170 charitable contribution deductions and the use of an exempt entity as an accommodation party in a transaction that will shift tax benefits. Abusive tax transactions involving exempt organizations by Underwood, Joyce M. / The Tax Adviser * The accommodation party must hold legal title to the property [during the transaction] and also hold other indicia of ownership that are recognized under commercial law, such as a contract for deed. IRS blesses reverse exchanges by MILLER, DOUG / Real Estate Weekly On the taxpayer's behalf, an accommodation party purchased property intended to be replacement property for the park property. Non-safe-harbor reverse-exchange guidance by Bakale, Anthony / The Tax Adviser More results

170 charitable contribution deductions and the use of an exempt entity as an accommodation party in a transaction that will shift tax benefits.

Abusive tax transactions involving exempt organizations by Underwood, Joyce M. / The Tax Adviser

* The accommodation party must hold legal title to the property [during the transaction] and also hold other indicia of ownership that are recognized under commercial law, such as a contract for deed.

IRS blesses reverse exchanges by MILLER, DOUG / Real Estate Weekly

On the taxpayer's behalf, an accommodation party purchased property intended to be replacement property for the park property.

Non-safe-harbor reverse-exchange guidance by Bakale, Anthony / The Tax Adviser

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