Real estate industry freaked out by Republican tax reform plan

Miami /
Dec.December 29, 2016 09:45 AM

From the New York website: Some real estate insiders are worried a Republican overhaul of the tax system could damage the industry.

In June, Republican federal lawmakers proposed a tax reform, and lobbyists told the Wall Street Journal that it stands a decent chance of passing now that Donald Trump is set to occupy the White House. “The House is ready to roll,” said Jeffrey DeBoer of the Real Estate Roundtable.

But despite Republicans’ tax-cutting credentials, some worry that the proposed changes could plunge the real estate industry into turmoil. For example, the plan would double the standard deduction available to taxpayers, which would take the teeth out of the mortgage interest deduction (an itemized deduction) and lessen the tax advantage of buying a home.

“Because of the other provisions included in the new tax system, far fewer taxpayers will choose to itemize deductions,” the Republican proposal reads.

The plan would also scrap a provision that allows companies to write off property depreciation over time. Buyers of apartment buildings can depreciate the cost over 27.5 years, with other commercial real estate being written off over 39 years. Instead, firms would be able to record the price of buying a property as a one-off business expense.

Real estate insiders worry that such changes could harm investors who bought properties under the assumption that the old tax rules would remain in effect. “The transition rules are really, really critical,” DeBoer said. [WSJ]Konrad Putzier 


Related Articles

arrow_forward_ios
Eric and Lara Trump with 502 Bald Eagle Drive in Jupiter (Getty, Google Maps)
Trump town: Eric and Lara buy home near Don Jr. in Jupiter
Trump town: Eric and Lara buy home near Don Jr. in Jupiter
Fontainebleau Miami Beach, Jeffrey Soffer and former President Donald Trump (Ebyabe/Wikipedia, Getty, iStock)
Gambling portability a no-go in Florida this year for Jeffrey Soffer, Trump
Gambling portability a no-go in Florida this year for Jeffrey Soffer, Trump
Gil Dezer (Photos by Sonya Revell)
The Closing: Gil Dezer
The Closing: Gil Dezer
Brad Parscale and 2319 Desota Drive (Getty, Google Maps)
Brad Parscale, ex-Trump campaign manager, sells Fort Lauderdale home
Brad Parscale, ex-Trump campaign manager, sells Fort Lauderdale home
Donald Trump with sons Eric and Don Jr. and 1125 South Ocean Boulevard (Getty, Google Maps/Illustration by Alexis Manrodt for The Real Deal)
Trump lists beachfront mansion next to Mar-a-Lago for $49M
Trump lists beachfront mansion next to Mar-a-Lago for $49M
Photo illustration of Donald Trump at Mar-a-Lago (iStock, Getty/Illustration by Kevin Rebong for TRD)
Trump argues to live in Mar-a-Lago — as an employee
Trump argues to live in Mar-a-Lago — as an employee
535 North County Road and Mark Pulte with former President Donald Trump (Google Maps; Pulte Family Foundation; Getty)
Spec home built on Trump’s former Palm Beach property under contract for $140M
Spec home built on Trump’s former Palm Beach property under contract for $140M
Trump Plaza’s condo board votes to remove ex-president’s name from West Palm towers
Trump Plaza’s condo board votes to remove ex-president’s name from West Palm towers
Trump Plaza’s condo board votes to remove ex-president’s name from West Palm towers
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...