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New tax law could boost commercial real estate owners

On Behalf of | Dec 28, 2017 | Commercial Real Estate

Texas commercial real estate owners may get a boost from the passage of the tax bill. Under it, people who own real estate that is held in pass-through companies stand to enjoy significant reductions in their tax liability.

According to the Wall Street Journal, people who earn less than $157,100 per year and who own pass-through companies with real estate holdings will receive a 20 percent deduction on the amount of income that is taxable. Those who make less than $315,000 and who are joint filers will also receive a 20 percent deduction

Commercial real estate experts say that the new tax law will be a boon for the commercial real estate market. People who earn more than the stated amounts are still provided other ways to enjoy the deductions. The tax bill’s primary goal is to encourage pass-through company owners of real estate to move to growth models instead of preservation models. The reductions in taxable income may encourage owners of pass-through companies to expand their holdings and to grow.

People who are interested in commercial real estate or who own properties might want to discuss forming pass-through companies for their holdings with experienced real estate and business law attorneys. Such attorneys might help their clients to structure pass-through companies in such a way that their clients might enjoy the greatest tax benefits. They may also advise their clients about other laws that might impact them so that their clients might avoid legal issues and pitfalls that may otherwise happen. Attorneys can also often help their clients to conduct due diligence on all of the properties that they might be considering so that they might make certain that their investments are sound.


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