Budget Bill Includes Key Partnership Tax Audit Provisions (Update)

10/29/2015 | by

The budget agreement passed by the House of Representatives on Oct. 28 contains a measure that would change the procedures on how partnerships are audited for tax purposes.

The measure reflects most of the changes requested earlier this year by NAREIT, The Real Estate Roundtable and other real estate groups. Specifically, the budget bill does not include a liability provision opposed by NAREIT and the organizations. Additionally, the bill does not identify REITs as triggering partners for purposes of applying the new audit rules.

UPDATE: President Obama signed the bill into law on Nov. 2.

(Contact: Cathy Barre at cbarre@nareit.com)

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What's a REIT?

REITs, or real estate investment trusts, are companies that own or finance income-producing real estate across a range of property sectors. These real estate companies have to meet a number of requirements to qualify as REITs. Most REITs trade on major stock exchanges, and they offer a number of benefits to investors.

Why Invest in REITs

REITs historically have delivered competitive total returns, based on high, steady dividend income and long-term capital appreciation. Their comparatively low correlation with other assets also makes them an excellent portfolio diversifier that can help reduce overall portfolio risk and increase returns. These are the characteristics of real estate investment.

About Nareit

Nareit serves as the worldwide representative voice for REITs and real estate companies with an interest in U.S. real estate. Nareit’s members are REITs and other real estate companies throughout the world that own, operate, and finance income-producing real estate, as well as those firms and individuals who advise, study, and service those businesses.