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Sweeping Tax Reform Proposals Creating Suspense for CRE Investors

January 17, 2017

Sweeping Tax Reform Proposals Creating Suspense for CRE Investors

Federal Tax Code Changes Ranging From Eliminating Long-Term Depreciation to Taxing Carried Interest at a Higher Rate Could Hold Dramatic Implications for CRE Industry

January 11, 2017 | by Randyl Drummer | CoStar

With President-elect Donald J. Trump preparing to take office next week and the Republican-controlled 115th Congress already in session, the newly reconstituted House Ways and Means Committee met for the first time this week to discuss the GOP’s tax reform “blueprint” released last summer calling for sweeping changes to federal tax law.

The Real Estate Roundtable and other industry lobbying groups have been working with Ways and Means committee staff since last fall to convert the House tax reform blueprint into legislation that can be introduced early this year. The plan would significantly lower income tax rates for corporations, pass-through entities and investors while possibly bringing major changes to how real estate investments are taxed.

The blueprint would replace current depreciation rules with immediate and full expensing of capital investment in commercial buildings, excluding land. To recover federal revenue lost under the change, the plan proposes to eliminate deductions such as net interest expense.

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Gil Armour, CFP
February 3, 2016

I have been using Blue Vault Partners for the past five years.  I have found them to be a valuable, unbiased resource when it comes to evaluating and comparing non-traded REITs.  The reports help me analyze which sponsors are doing a responsible job of managing their offerings.  This allows me to limit my REIT recommendations to only the most competitive products, and then track those REITs throughout their life cycle.