Speakers: TCJA Has Created New World for Real Estate Industry
Partners Mark Goldsmith and Robert Friedman are quoted in an article published by the New York State Society of Certified Public Accountants titled, “Speakers: TCJA Has Created New World for Real Estate Industry.” The two were panelists at the Foundation for Accounting Education's Real Estate Conference on Nov. 15, discussing the risks and opportunities of The Tax Cuts and Jobs Act. In discussing an exception in the Opportunity Zone program that exists if an entity acquires a property already in service but then makes substantial improvements, defined as an amount equal to the cost of the property itself, Goldsmith said, "On its face, that seems to be insurmountable in many instances. If you buy a two-story building and add 10 stories, that would be easy, but if you buy an existing multifamily property and just renovate the apartments, you're probably not going to spend equal to your investment." Friedman discussed a complication that arises with the alternative depreciation system (ADS) to depreciate property with a recovery period of 10 years or more, pointing out that, "At the moment, we've no rules on when and how to make the election. So you can do the math this year and wait and see what happens. 2021, most people think, will be a big factor for determining whether you are hurt by the new 30 percent limit or not and, at the moment, [you] can wait until that point in time to make the election."