The National Association of REALTORS® (NAR) has issued a Call for Action asking REALTORS® to contact Congress and send the message loud and clear that two federal tax proposals being considered would have a negative impact on real estate, which in turn, affects those in the industry by slowing the housing market recovery.
What are the proposals? According to NAR:
- One would require ALL owners of rental properties to file an IRS Form 1099 for all contractors they do business with if they pay that contractor $600 or more in a given year. It would apply to even the smallest landlord, creating unnecessary burden and tax preparation expense for those who have, or might be considering, real estate investments.
- The other would tax “carried interest” at ordinary income rates instead of capital gains. Carried interest rules govern how general partners in real estate investments pay taxes when the investment is sold. The proposal is particularly onerous because it would set a precedent that certain real estate investment gains would no longer qualify for capital gains treatment.
If you haven’t answered the Call for Action, do so now and help the REALTOR® voice be heard!