IRS issues favorable PLR on REIT preferential dividend issue

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July 2019

Overview

In PLR 201924003 (the PLR), the IRS ruled that a subsidiary REIT (Sub REIT) of a publicly offered REIT (Parent REIT) also is treated as a publicly offered REIT for purposes of the exemption from the preferential dividend rule.

The takeaway

Although a PLR may not be used as precedent, this ruling indicates that the IRS may be willing to rule favorably in cases involving similar distributions by consolidated subsidiaries of publicly offered REITs.

Contact us

Adam Feuerstein

Principal, National Real Estate Tax Technical Leader, PwC US

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