Securitization of Our Nation’s Forests: Legal and Practical Implications of the Timber REIT Phenomenon
Author: Thomas D. Hunt.
Source: Volume 34, Number 04, Summer 2017 , pp.47-66(20)
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Abstract:
Since the 1930s, Congress has slowly encouraged companies engaged primarily in the business of real estate to follow certain rules in order to qualify as “real estate investment trusts” (REIT) entities that receive preferential tax treatment under the Internal Revenue Code. Over the last two decades, many large timberland companies have restructured themselves as REITs, changing the dynamics of the timberland industry by leaps and bounds. In addition to the normal benefits of qualifying as a REIT, Congress has offered certain additional benefits to those engaged in the timber business. This article explores how this came to be and whether there is any merit to offering such benefits.Keywords: real estate investment trusts, REIT taxation, timber, timberland, real estate, 5/50 rule, gross income tests
Affiliations:
1: Robert M. Currey & Associates Risk Management Consulting.