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The tax implications of investing in REITs can vary given the type of REIT and the investor’s individual tax situation (we will explain taxes in a section below). Understanding the Mechanics of ...
A REIT is a company that owns, manages, or finances income-producing real estate. Like mutual funds, REITs pool money from many investors and are traded on major stock exchanges. They offer an ...
In order to become a REIT, the organization needs to be registered as a corporation, trust, or association; it needs to be run by one or numerous trustees or directors. [2] A taxable REIT subsidiary (TRS) is a directly or indirectly REIT-owned corporation that was cooperatively elected alongside the REIT to be managed as a TRS for tax reasons.
REITs were created in the United States after President Dwight D. Eisenhower signed Public Law 86-779, sometimes called the Cigar Excise Tax Extension of 1960. [12] [13] The law was enacted to allow all investors to invest in large-scale, diversified portfolios of income-producing real estate in the same way they typically invest in other asset classes – through the purchase and sale of ...
The largest U.S. REIT, Prologis, traded at about $109 per share on May 15. While REITs are not exchange-traded funds, publicly traded REITs have some features in common. For example, both measure ...
Funds from operations (FFO) is the term that investors use to describe the cash flow of a real estate company or a real estate investment trust (REIT). [1] FFO is a performance indicator created by the National Association of Real Estate Investment Trusts (NAREIT) that is recognized by the SEC to be the standard non-GAAP gauge of financial performance for the real estate sector.
2. Research REIT funds. When selecting REIT ETFs, pay attention to factors such as dividend history, dividend yield, the fund’s performance, expense ratios, top holdings and assets under ...
A RIC is a trust, corporation or partnership in which investors have common investment and voting rights but do not have direct interest in investments of the investment company or fund. A grantor trust, in contrast, grants investors proportional ownership in the underlying securities. A UIT is created by a document called the Trust Indenture.