Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) granted the panel’s five tax reform working groups an extension on May 21. The groups had originally been charged with making recommendations by the end of this month. A new deadline will be set when the Senate returns after the Memorial Day recess. Tax reform continues to be a key issue for the multifamily industry because real estate depends on the free-flow of capital and after-tax rates of return.
“It is our hope these bipartisan working groups will use this extended time to finalize their recommendations for tax reform and produce in-depth analyses of option and potential legislative solutions,” said Hatch and Wyden.
NMHC/NAA weighed-in recently with the Senate Finance Committee on the multifamily industry’s tax reform priorities.
However, the prospects for tax reform remain cloudy. President Obama and Republican lawmakers continue to disagree over whether tax reform should focus only on corporations or include the individual side of the code, which is used by pass-through entities (i.e. LLCs, partnerships and S Corporations) that dominate the multifamily industry.
House Ways and Means Committee Chairman Paul Ryan (R-WI) has acknowledged that tax reform focused on the individual side of the tax code is unlikely until 2017. In addition, he’s suggested that Congress could look to reform international tax provisions before undertaking a broader overhaul.
Of particular interest to the multifamily industry, Ryan recently took off the table a proposal long opposed by industry to tax carried interest at ordinary income tax rates instead of the lower capital gains rates. “That is on the individual side of the code, so it’s not something we’re looking at right now. That’s what we see as a 2017 conversation,” he said.
- NMHC and NAA Signal Support for the Affordable Housing Credit Improvement Act
- ACTION Coalition Letter - June 2019
- Wyden Introduces the “Ending the Carried Interest Loophole Act”
- Senator Harris Introduces Renter’s Tax Credit
- IRS Issues Guidance Clarifying Multifamily Housing Bonds and Low-Income Housing Tax Credit (LIHTC)