Thursday, August 4, 2011

Carried Interest Tax Hike Averted in Debt Ceiling Deal

BOMA San Francisco Members:

On Tuesday President Obama signed legislation that would raise the debt ceiling by up to $2.4 trillion in two stages, enough to allow the government to borrow into 2013. Fortunately for the commercial real estate industry, the proposed tax increase on carried interest was not included, as the final compromise did not include revenue raisers. 

The final bill calls for at least $2.4 trillion in spending cuts over ten years, with $900 billion in across–the–board cuts to be enacted immediately. It also creates a joint committee tasked with identifying an additional $1.2 trillion to $1.5 trillion in deficit reduction measures. If Congress fails to enact the joint committee’s recommendations in an up–or–down vote, with no amendments allowed, across–the–board cuts totaling $1.2 trillion, mostly on discretionary spending, would go into effect.

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