The Real Estate Roundtable on Monday submitted detailed recommendations to the Treasury Department on simplifying and streamlining the new 20 percent tax deduction for pass-through businesses. (Roundtable letter, Oct. 1)
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The Real Estate Roundtable on Monday submitted detailed recommendations to the Treasury Department on simplifying and streamlining the new 20 percent tax deduction for pass-through businesses. (Roundtable letter, Oct. 1) |
Trade or business definition
The final regulations should clarify that rental income from real property held for the production of rents will be considered a trade or business for purposes of section 199A;
Aggregation
The final regulations should allow taxpayers to treat all qualifying real estate rental activities, whether held directly or through a pass-through entity, as if held in a single “trade or business” for purposes of section 199A;
Non-recognition transactions
When assets with associated unadjusted basis immediately after acquisition (UBIA) are transferred in a non-recognition transaction (such as a like-kind exchange or the contribution or distribution of assets involving a partnership or S corporation), the general rule should be that the UBIA of an asset (and its duration) carries over; and
Separating trades and businesses
The final regulations should provide rules to help taxpayers ascertain when multiple activities (including multiple activities conducted in a single entity) constitute discrete trades or businesses.
TPAC will continue to offer insight to Treasury officials and congressional tax-writing committees before final regulations are expected by the end of the year.