The Washington update panel, held during Nareit’s REITworks: 2020 Virtual Conference, discussed tax legislation and proposals affecting commercial real estate with a focus on the current election, diversity and inclusion, and COVID-19.
The panel, moderated by Robert Dibblee, SVP - Government Relations, Nareit, included panelists:
Dara Bernstein , SVP & Tax Counsel, Nareit
John Jones , VP- Government Relations, Nareit
Dibblee and Jones both discussed current polling regarding the November presidential and congressional elections. Jones highlighted H.R. 5084, introduced by Rep. Gregory Meeks (D-NY), a bill that would require the issuers of securities to disclose the racial, ethnic, and gender composition of their board of directors and executive officers, as well as their veteran status. It would also require the SEC to form a diversity advisory group to report on diversity statistics.
“Nareit is proud to be an early supporter of this important legislation,” Jones said.
The bill resulted from a 2019 House Financial Services Committee hearing to discuss proposals to increase the diversity of corporate boards. H.R. 5084 was the amalgamation of two of those proposals.
Dibblee discussed the newly formed Business Continuity Coalition (BCC). Nareit and the Real Estate Roundtable are working with the policy holder community to develop a proposal that enhances the underwriting of pandemic-related risks in commercial property-casualty insurance lines. The proposal will consist of two equally important programs: A basic parametric expense replacement policy, and access to federal reinsurance.
· Bernstein discussed some of the tax issues and opportunities applicable to the REIT industry. She mentioned that absent legislation, the limitation on business interest deductibility, currently based on 30% of EBITDA, will be based on 30% of EBIT beginning in 2022 ,and the section 199A’s
· 20% pass-through entities qualified business income and qualified REIT dividend deduction will expire. on Dec. 31, 2025. In addition, Bernstein discussed Sen. Ron Wyden’s(D-OR) mark-to-market proposal .
· and, along with Dibblee, compared the tax plans of the two presidential candidates.