What To Watch In The Tax Reform Process
November 13, 2017 | Paul Bubny | GlobeSt.com
WASHINGTON, DC—Generally speaking, commercial real estate came off pretty well in the House Ways & Means Committee’s $1.51-trillion tax reform measure, GlobeSt.com reported earlier this month. Now the Senate Finance Committee has introduced its own version of the plan, and there are enough differences between the two bills that the final scorecard for CRE will depend on whether the Senate or House language prevails on specific points.
There are key similarities, as well. The Commercial Real Estate Finance Council notes that both the House and Senate plans would maintain the deduction for interest on commercial loans, like-kind exchanges for real property under Section 1031 of the Internal Revenue Code and the existing regimes for commercial property cost-recovery and depreciation.
On other counts, though, the House and Senate measures part company. As GlobeSt.com reported earlier in November, the House plan would attach a three-year holding period to carried interest, bumping it up the current one-year hold required for the interest to be taxed at the lower capital gains rate. Ways and Means Chairman Kevin Brady said this was to “make sure it’s really focused on those long-term, traditional real estate partnerships.”
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