Stimulus Package Unlikely to Include REITs; Real Estate Investment Trusts Seen Losing Tax Advantage under Bush Plan

The Washington Times (Washington, DC), January 8, 2003 | Go to article overview

Stimulus Package Unlikely to Include REITs; Real Estate Investment Trusts Seen Losing Tax Advantage under Bush Plan


Byline: Tim Lemke, THE WASHINGTON TIMES

One group of companies that would be hurt by President Bush's economic-stimulus package is real estate investment trusts, which would lose their tax advantages unless they are included in the final legislation.

Many analysts expect that the more than 300 REITs nationwide will not be privy to tax breaks on dividends offered to most companies, because they already are exempt from normal income taxes.

REITs are companies that own and often manage real estate such as office buildings, malls and apartment complexes. They are required by law to distribute 90 percent of taxable income to shareholders in the form of dividends. As a trade-off, REITs do not pay corporate income tax.

Mr. Bush's proposal to eliminate a tax on dividends is an effort by the administration to eliminate "double taxation." Most companies already pay corporate income tax.

There is no wording in Mr. Bush's plan addressing REITs or any other specific stock. But analysts said final legislation is likely to include language excluding the sector from any tax breaks.

"The general thinking seems to be that REITs will be excluded," said Rich Moore, a real estate analyst with McDonald Investments in Cleveland.

This could be bad news for the valuation of REITs, analysts say, because investors may decide to move their money to other stocks that pay untaxed dividends.

Merrill Lynch analyst Steve Sakwa said in a research note that the value of REIT stocks could decline as much as 9 percent if a tax is eliminated for all dividends except those issued by REITs.

What's more, analysts said, some REITs might opt to change their structures, choosing to pay corporate income tax and free themselves of their dividend requirements. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Stimulus Package Unlikely to Include REITs; Real Estate Investment Trusts Seen Losing Tax Advantage under Bush Plan
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.