Tax reform continues to be the subject of intense discussion in our nation's capital. While prospects for legislation remain uncertain, tax reform has the capacity to significantly impact owners, operators and developers of multifamily rental housing when they build, operate, sell and even transfer apartment communities to their heirs. The apartment industry favors pro-growth reform that avoids disadvantaging our industry relative to other asset classes.
Notably, on April 4, 2013, NMHC/NAA responded to a request from the House Ways and Means Committee to submit input on tax reform priorities. The Ways and Means Committee has created 11 working groups to study various areas of the tax code. Once interested parties submit their views, the Joint Committee on Taxation will submit a report to the Committee due on May 6 that summarizes comments received. The full Committee is then expected to continue working on comprehensive reform proposals that could see action later this year.
In our submission, NAA and NMHC underscored our view that tax reform must address both the individual and corporate sides of the tax code. Flow-through entities that dominate the apartment industry and pay tax based on the individual side of the code should not shoulder the cost of corporate tax reform.
In addition to comprehensive tax reform, NMHC/NAA urged Congress to maintain current tax treatment of carried interest, retain the deduction for business interest, protect the Low-Income Housing Tax Credit program and preserve the current law on estate taxes.
Finally, NMHC/NAA also submitted a second letter that indicated the importance of tax incentives for improving energy efficiency in commercial buildings and large multifamily properties as a means of leveraging private investment in qualified building retrofits.
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