WORLD PROPERTY CHANNEL ®

A bill that would make U.S. real estate trusts more attractive to foreign investors easily passed the House of Representatives today.

The Real Estate Jobs and Investment Act (H.R.5901) would double the amount a foreign citizen could invest in a REIT before a stiff capital gains tax kicks in. Under current law, only foreign investors with five percent or less ownership in a REIT are exempt from the tax.

The bill seeks to resolve a long-standing inequity in the way foreign investors in REITs are taxed.

"Under current U.S. tax law, foreign investors generally do not pay capital gains taxes when they sell stock in a U.S. corporation," an executive summary of the bill notes. "Foreign investors with a stake in [REITs]... are taxed more heavily."

The bill, introduced by Rep. Joseph Crowley (D-NY), passed 402-11. The measure still must be approved by the Senate before it goes to the President for a final signature.

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