When Evan Liddiard dabbled in property management as a teenager, he never imagined that one day he'd monitor federal tax policy for the world's largest real estate organization. But as the National Association of Realtors' senior policy representative for federal taxation, Liddiard keeps close watch on tax laws affecting both residential and commercial real estate.
Tax policy remains a key issue to watch through year-end, given an uncertain economic climate and continued congressional wrangling, Liddiard says. “While enactment of comprehensive tax reform in 2013 is improbable, the possibility it could occur signifies the biggest potential threat for commercial real estate this year.”
U.S. House and Senate leaders continue to discuss a “blank slate” approach to tax reform, which means every tax deduction, exemption, and credit is “on the table,” he explains. In addition, the House Ways and Means Committee's draft simplification bill includes an option that would repeal the flexibility of partnership tax rules - another factor that could have long-standing implications for the commercial real estate industry, he says.
Liddiard's 20-year role as tax policy adviser for Sen. Orrin G. Hatch, R-Utah - who is currently the longest-serving Republican on the Senate Finance Committee - gave him an in-depth understanding of tax policy as it relates to real estate. “Senator Hatch was a leader on a number of real estate-related tax bills, including legislation to modernize REIT provisions, shorten depreciation periods, lower the capital gains tax rate, improve the low-income housing tax credit, and ease the FIRPTA rules,” he explains.
Liddiard adds that CCIM members are in a unique position to educate and inform their congressional leaders. “By providing relevant information about real-life projects and the state of the real estate industry back home, CCIMs can be a source of much-needed insight to those who represent them in Congress,” he says. “By building relationships with and educating members of Congress and key staffers, CCIMs can help to decrease the chance that Congress will enact far-reaching changes that could harm the industry.”
Evan Liddiard discussed the potential effects of tax policy changes at CCIM Live! Oct. 25-26, 2013, in Denver. Learn more about CCIM Institute's annual conference.