Economy
Related: About this forumBonanza for rich real estate investors, tucked into stimulus package
The federal governments planned $2 trillion economic rescue package includes financial aid for individuals and industries that are struggling to survive the coronavirus pandemic.
It also includes a potential bonanza for Americas richest real estate investors.
Senate Republicans inserted an easy-to-overlook provision on page 203 of the 880-page bill that would permit wealthy investors to use losses generated by real estate to minimize their taxes on profits from things like investments in the stock market.
The estimated cost of the change over 10 years is $170 billion.
Under the existing tax code, when real estate investors generate losses from gradually writing down the value of their properties, a process known as depreciation, they can use some of those losses to offset other taxes.
The result is that people can enjoy big tax breaks stemming from only-on-paper losses, even if they enjoy big cash profits in the real world.
At: https://www.nytimes.com/2020/03/26/business/coronavirus-real-estate-investors-stimulus.html
The Trump clause?
customerserviceguy
(25,183 posts)and while I haven't been one for a few decades, it was my impression that real estate losses were always deductible against ordinary income (wages, interest, dividends, pensions, etc.) And I would not expect a lot of taxpayers to have gains from the stock market, unless they cashed out in January or February.
Sucha NastyWoman
(2,748 posts)I think thats fair enough.
Id they are talking about losses due to depreciation, that should be eliminated permanently, covid19 or not.
Real estate does not depreciate over time
sandensea
(21,624 posts)The pretext for this has always been something along the lines of: "Hell bells - how do you expect developers to develop if they can't have that 'depreciation' deduction?"
Yeah, right! As if any developer would pass up the world's biggest real estate market by far, on account of not getting some tax giveaway.
They're just too used to taking everyone else for suckers, that's all.
Trump's specialty.