The real estate industry seems to be on the upswing lately. Investor confidence has been building and current values are generating interest at home and abroad. Technology has improved the sector’s ability to streamline operations, manage properties, and get close to customers. At the same time, new tax laws, accounting rules, and risk strategies are challenging directors, especially audit committee members, to be more engaged than ever before. Our goal with this publication is to provide you a high-level review of current accounting and tax concerns facing the real estate sector in order to help you focus on areas that may need increased oversight.
Tax reform will drive much of the learning that directors need to do for 2018. Several provisions in the recently enacted tax bill could affect real estate businesses in a variety of ways, such as the reduction of the corporate tax rate, the elimination of the corporate alternative minimum tax, changes to personal rates and deductions for business earnings of pass-through entities, full expensing for asset purchases, and other provisions. More information on this pivotal issue is provided in the following chapter on tax reform.
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