On November 2, House Ways and Means Committee Chairman Kevin Brady (R-TX) released the “Tax Cuts and Jobs Act of 2017” (HR 1, or the “Bill”). On November 3, the Chairman’s Mark of the Bill was released, and Chairman Brady offered further substantive amendments on November 6. Consideration of the Bill will continue, with further mark-up activity expected over the coming days and weeks. While substantial modifications are likely, the Bill contains numerous individual and business tax proposals that will certainly shape the direction of tax reform. Below is a summary of a number of the proposals that are likely to impact our clients and their businesses, as well as commentary on some of the more relevant provisions, with a particular emphasis on REITs and real estate fund participants.

Summary -

Individual and Corporate Tax Rates. The Bill reduces the top marginal tax rate on domestic corporations from 35% to 20%. Individual tax rates are proposed to be compressed into four brackets. The highest bracket remains at 39.6% but would kick in at higher income levels (e.g., $1 million for joint filers, as compared to $480,050 for 2018 under current law).