Commercial Real Estate will hit “the jackpot” with GOP tax plan
Commercial real estate owners who hold properties through pass-through companies could fare quite well under the final Republican tax bill compared to other companies using the same structure.
The proposal gives a 20 percent deduction on taxable income to pass-through companies owned by individuals who make less than $157,500 and joint filers who make less than $315,000, the Wall Street Journal reported.
In addition, it gives owners of some pass-throughs who surpass those income levels another way for qualifying for that deduction, which favors private real estate firms with few employees and large real estate holdings, according to tax lawyers.
“If enacted, the commercial real-estate industry will have hit the jackpot,” said Steven Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center.
Steve Witkoff said the tax proposal’s main goal is to encourage businesses to move away from “preservation of capital” and into growth-mode.
“The psychic value is that you finally have a government saying we are creating incentives for you under the tax code to build more, create more manufacturing facilities and create jobs,” he said.
Still, others were worried that some elements of the proposal, such as eliminating the ability to deduct state and local taxes, could be a drag on the economy.
Source: The Real Deal: New York Real Estate News, December 18, 2017 8:30am
Read More: https://therealdeal.com/2017/12/18/cre-will-hit-the-jackpot-with-gop-tax-plan%E2%80%A8/