Much uncertainty remains regarding how tax reform will proceed under the Trump administration and Republican-controlled Congress, but the commercial real estate industry is closely watching the tax policy debate in Washington, D.C.

KPMG examined the House Republican Blueprint, as well as the Trump campaign tax plans, noting the implications for the alternative investment industry. The Trump campaign proposed taxing carried interest as ordinary income but with the income rate as low as 15 percent, which would be a negligible or even beneficial rate for investment fund managers. KPMG notes it remains unclear, though, whether this change would apply to hedge funds only, or to private equity and real estate funds, as well.

Another area of controversy is the House Republican Blueprint’s border-adjustment tax, also described as a destination-based cash-flow tax. Such a tax would shift taxation from production within the United States to sales within the United States, acco