In a letter submitted to the IRS on June 14, Nareit requested the IRS to issue guidance on a number of issues, with the principal request of the IRS issuing guidance confirming that the Tax Cuts and Jobs Act’s 20% deduction for REIT dividends applies to REIT shares held through mutual funds. The list of 10 recommendations submitted in response to an IRS request for input on its annual guidance plan additionally included a request that IRS use its authority to treat a new type of deemed income from foreign sources (“global intangible low-taxed income”) as qualifying income similar to dividends for REIT income testing purposes.
As Nareit has requested many times and most recently last May, the June 14 letter also recommended that the IRS withdraw Notice 2007-55, which applies the rules set out by the Foreign Investment in Real Property Tax Act (FIRPTA) to REIT redemptions and liquidating distributions.