Real estate investors will get $170B windfall from bailout package

Provision in $2T bill lifts restrictions on depreciation

National /
Mar.March 26, 2020 06:48 PM
U.S. Senate Majority Leader Mitch McConnell (Credit: Win McNamee/Getty Images, iStock)

U.S. Senate Majority Leader Mitch McConnell (Credit: Win McNamee/Getty Images, iStock)

Tucked inside the federal government’s massive economic rescue package is a $170 billion windfall for real estate investors.

Washington’s $2 trillion bill is a provision that allows investors to write down the depreciation on properties beyond the previous limit of $500,000 a year, the New York Times reported. According to a draft congressional analysis, it’s the second-largest tax giveaway in the multitrillion-dollar proposal.

“It’s a pretty big deal,” Peter Buell, an accountant who heads up the real estate tax services practice for Marcum, told the Times.

Per the terms of President Trump’s 2017 tax cuts, investors could use depreciation to shield the first $500,000 of a married couple’s capital gains from investments each year.

The current rescue package lifts that restriction for three years, according to the Times. Senate Republicans inserted the language onto page 203 of the 880-page bill. The House of Representatives is expected to pass the bill Friday.

A spokesperson for the Real Estate Roundtable, however, said that some investors avoided the annual cap by spreading their losses out on paper over several years, downplaying the real impact of the new proposal.

Among those who stand to benefit are people close to Trump including his son-in-law and senior adviser Jared Kushner, who reportedly likely didn’t pay federal income taxes for several years due to depreciation of his properties. [NYT] — Rich Bockmann


Related Articles

arrow_forward_ios
429 Center Island Drive and Vladimir Spector (Lifestyle Production Group, Linkedin)
Golden Beach mansion of late South Florida developer who died of Covid-19 trades for $8M
Golden Beach mansion of late South Florida developer who died of Covid-19 trades for $8M
86800 Overseas Highway, Islamorada (Google Maps, iStock)
Islamorada closes administrative building due to Covid-19
Islamorada closes administrative building due to Covid-19
From left: Tom Brady and Gisele Bündchen; Pharrell Williams; Sylvester Stallone and Jennifer Flavin; Jared Kushner and Ivanka Trump (Getty, iStock)
South Florida’s biggest real estate stories of 2020
South Florida’s biggest real estate stories of 2020
Florida Gov. Ron DeSantis (Credit: Joe Raedle/Getty Images)
DeSantis says restaurants in Florida can operate at up to 100% capacity
DeSantis says restaurants in Florida can operate at up to 100% capacity
Peter Vauthy and Red South Beach (Getty)
The Weekly Dish: Red South Beach signs $5M lease for new space & more
The Weekly Dish: Red South Beach signs $5M lease for new space & more
Miami-Dade County Mayor Carlos A. Gimenez (Credit: Jason Koerner/Getty Images)
Miami-Dade police said pre-Covid evictions could resume. Then came mayor’s stop order
Miami-Dade police said pre-Covid evictions could resume. Then came mayor’s stop order
Miami-Dade County Mayor Carlos A. Gimenez (Credit: Jason Koerner/Getty Images)
Miami-Dade begins phase 2 reopening: movie theaters, bowling alleys and more
Miami-Dade begins phase 2 reopening: movie theaters, bowling alleys and more
Florida Gov. Ron DeSantis (Credit: Joe Raedle/Getty Images)
DeSantis moves Miami-Dade, Broward counties into phase two
DeSantis moves Miami-Dade, Broward counties into phase two
arrow_forward_ios

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

Loading...