Last Wednesday, the Trump administration and Republican leadership from the U.S. House and Senate released the outline of the long-anticipated tax reform plan, “Unified Framework for Fixing Our Broken Tax Code.” The nine-page framework outlines some specific changes to the tax code, including lowering the tax rate for pass-through businesses to 25 percent; reducing the corporate tax rate to 20 percent; and allowing full expensing of new investments in depreciable assets other than structures for up to five years.
While these reforms could have the potential to positively impact the commercial real estate industry, many specifics remain unaddressed. For instance, there is no mention of 1031 “like-kind” exchanges, carried interest, depreciation of structures, how interest expense will be limited or how tax cuts will be funded. This framework is the latest in a series of discussion documents outlining how President Trump and congressional leadership view comprehensive tax reform. BOMA International advocacy staff will continue to work with members of Congress to help craft legislation that encourages the growth and health of the commercial real estate industry. For more information on BOMA’s policy position on tax reform, visit the BOMA International website.