Marcus & Millichap Webcast Drills Down into CRE Implications of Biden Administration’s “Very Serious Proposal” for Tax Reform
In a recent Marcus & Millichap webcast titled “Tax Reform: A CRE Game Changer?,” CEO Hessam Nadji noted that provisions of particular concern to the firm’s clients, many commercial real estate investors and the industry as a whole are the increase in the top-tier income tax rate to 39.6%, the increase in the capital gains tax rate, the institution of a $500,000 cap for the 1031 exchange, elimination of the step-up basis for gains of $1 million or more, and the taxation of carried interest for investments and developments at the same rate as ordinary income.
Nadji and his panelists—Jeffrey DeBoer, president and CEO of the Real Estate Roundtable; and Lisa Knee, partner with EisnerAmper—emphasized that these proposals are just that. They haven’t manifested as actual legislation as yet, although Knee pointed out that a bill related to carried interest is being discussed in the Senate. However, DeBoer said, “This is a proposal from a President of the United States to a Congress that is controlled by his party. So it’s a very serious proposal and should be taken that way.”