Sen. Bob Menendez is urging the nominee for assistant secretary of the Treasury for tax policy to consider withdrawing an IRS notice on foreign investment in real estate.
IRS Notice 2007-55 applies the rules set out by the Foreign Investment in Real Property Tax Act (FIRPTA) to REIT redemptions and liquidating distributions. NAREIT has requested the withdrawal of the notice for many years, most recently in May. Menendez questioned President Donald J. Trump’s nominee for the Treasury tax policy position, David Kautter, about his willingness to review the notice with a view to withdraw it during a Senate Finance Committee confirmation hearing on July 18.
Menendez, who co-sponsored legislation in the past to repeal the notice, noted during the hearing that Notice 2007-55 has a chilling effect on foreign investment in commercial property and REITs.
Kautter said he would be willing to work Menendez and his staff on addressing the issue.
The Senate Finance Committee later voted in favor of sending Kautter’s nomination to the full Senate for consideration.
(Contact: Kirk Freeman at kfreeman@nareit.com)