Q: Was the 1031 Tax Deferred Exchange retained?
A: Tax deferred exchanges for real estate were retained. Tax deferred
exchanges can no longer be used for personal property.

Q: How will the elimination of allocated value to personal
property from Section 1031 impact cost segregation value of
real estate properties?
A: Cost segregation can still be done. The personal property – depending
on how the Treasury defines that – will not qualify for exchange treatment.

Q: Is the interest on a loan used to purchase investment real
estate still tax deductible?
A: Interest on loans used to finance investment real estate is still
deductible, but using this deduction will extend the depreciation
timeline for the asset.

Q: Can investment real estate still be depreciated?
A: Investment real estate can still be depreciated. If the mortgage
interest deduction is used, then the depreciation timeline for residential
real estate is extended from 27.5 years to 30 years, and for
commercial real estate the timeline is extended from 39 years to
40 years.

Q: Will carried interest for the Sponsor/GP on investment
real estate be considered Long-Term gains after one or three
years under the new tax law?
A: To be taxed at the capital gains rate, carried interest requires
that the asset be held for three years instead of one year.

Q: What is the effective date on the new tax rules?
A: January 1, 2018 for most tax rules, but several bonus depreciation
rules have an effective start date of September 2017.

Q: Is the tax law that was signed on December 22, 2017 the
final version, or are additional changes to the tax law anticipated?
A: There have already been changes to the tax law. When the Bipartisan
Budget Act of 2018 was signed on February 9, 2018 it
included several modifications to the tax law. Many ambiguities in
the new tax law will need to be addressed. Some will be handled
by Treasury Department and IRS interpretation, but several will require
technical corrections and modification by Congress.

Q: How long until the Treasury Department and IRS come out
with additional guidance? Will it come all at once or piecemeal?
A: Guidelines on income tax withholding were released in February.
Guidance on other tax ruling will likely be released in pieces.
The IRS has announced that additional guidance will be out this
summer.