Copyright: Songquan Deng
NMHC/NAA again took the opportunity to inform the Senate Finance Committee of the multifamily industry’s tax reform priorities. In mid-July, the industry submitted comments in response to a request from Finance Committee Chairman Orrin Hatch (R-UT) for stakeholder input on tax reform.
Key Trump Administration officials and Republican lawmakers are continuing to meet to try and develop a path forward for tax reform. The Trump Administration’s goal is to offer a consensus tax reform proposal once members return to Washington in September. If that occurs, Congress’ primary tax-writing committees, the House Committee on Ways and Means and Senate Finance Committee, would fill in the details throughout autumn.
Given the importance of tax reform to the multifamily industry, NMHC/NAA continue to aggressively advocate for our core tax principles. In our submission, we advocated that any tax reform proposal must:
- Protect Pass-Through Entities from Higher Taxes or Compliance Burdens;
- Ensure Depreciation Rules Avoid Harming Multifamily Real Estate;
- Retain the Full Deductibility of Business Interest;
- Preserve the Ability to Conduct Like-Kind Exchanges;
- Maintain the Current Law Tax Treatment of Carried Interest;
- Preserve and Strengthen the Low-Income Housing Tax Credit;
- Maintain the Current Law Estate Tax; and
- Repeal or Reform the Foreign Investment in Real Property Tax Act to Promote Investment in the Domestic Apartment Industry.
Additionally, the BUILD (Businesses United for Interest and Loan Deductibility) Coalition of which NMHC is a member submitted a letter to the Chairman Hatch that reinforced the necessity of preserving the full deductibility of interest on debt. Both NMHC and NAA also joined an ACTION Campaign letter supporting the retention and expansion of the Low-Income Housing Tax Credit.
Apart from tax reform, NMHC/NAA also took the opportunity to sign on to a coalition letter asking the Senate to repeal the net investment income tax as part of health care legislation. This levy imposes a 3.8 percent surtax tax on the unearned income, including capital gains and dividends, of passive real estate owners earning over certain thresholds ($200,000 single filers and $250,000 for married couples).
Over the coming weeks and months, NMHC/NAA will continue to work with lawmakers to develop tax reform legislation that encourages the multifamily industry, spurring economic growth and making it easier to develop housing for America’s families.