Understanding the Real Estate Provisions of Tax Reform: Motivation and Impact / James R. Follain, Patric H. Hendershott, David C. Ling.

Format:

Book

Author/Creator:

Follain, James R.

Contributor:

National Bureau of Economic Research.

Hendershott, Patric H.

Ling, David C.

Series:

Working Paper Series (National Bureau of Economic Research) no. w2289.

NBER working paper series no. w2289

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Understanding the Real Estate Provisions of Tax Reform

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1987.

Summary:

Capital investment tax provisions have been changed numerous times in the last decade, with depreciation tax lives shortened in 1981 and lengthened ever since and capital gains taxation reduced in 1978 and 1981 and now increased. The first part of this paper analyzes these changes and attributes a large part of them, including the 1986 Tax Act, to changes in inflation: tax depreciation schedules and capital gains taxation that look reasonable when the tax depreciation base is being eroded at ten percent a year and an overwhelming share of capital gains is pure inflation take on a different appearance when inflation is only four percent. The remainder of the paper critiques the typical project model used to compute impacts of tax changes on real estate and report simulation results using a modified model.

Notes:

Print version record

June 1987.