REIT capital gains taxation

CFA Level II Alternative Investments
#1

Hi guys,

Are you exempted from capital gains tax on a REIT investment if you take your profits and invest it in another REIT?

Thanks and god bless

Regards

#2

What does that even mean? Take your profits? Do you have a particular mechanism in mind?

#3

Hi,

What I meant was… if I take my distributions from the REIT (capital gains component of distributions) and invest it in another REIT, would I be liable for capital gains tax or can it be exempted since I’ve taken the gains and invested it in another REIT?

#4

The simple answer NO! (Tax exemption/deferral that is)

#5

I still don’t understand. Let’s make a simple example. Say you purchased 100 shares in a REIT for 100 dollars each in Jan 20X0. In Jan 20X1 these shares are worth 105 each and there is a distribution of 1 dollar dividend per share. What happens next?

#6

I think Taxation is exactly the same for REIT as for any other investment. You need to pay tax on your gains as per the Tax Laws in your country of residence. What you do with your gains is nothing to do with exclusion from paying tax.

#7

https://www.investopedia.com/articles/pf/08/reit-tax.asp