IPA Members Engage Directly with Key Democrats in Washington, D.C.
As I mentioned in my last update, our members have been on-the-ground in Washington, D.C. speaking to Democrats about the next steps in their agenda – reconciliation and the American Families Plan.
Earlier this year, as part of its American Families Plan, the Biden administration recommended capping Section 1031 like-kind exchange treatment to gains of $500,000 per individual, and $1 million per couple, to capture what they estimate to be $20 billion in savings over the next ten years.
We have worked tirelessly over the past three months to oppose any limitation of Section 1031, and in July, our members took part in a targeted fly-in to voice their concerns and emphasize the important role like-kind exchanges play in support of investors, business owners, retirement savers, and the broader economic well-being of our communities with key members of the Senate Finance Committee and House Ways & Means Committee.
Senator Maggie Hassan (D-NH) — Senator Hassan is a member of the Finance Committee and could face a competitive race against New Hampshire’s popular Republican governor in 2022. She won in 2016 with a little over 1,000 votes in what is truly a purple state.
Senator Hassan works across the aisle and is one of the 21 Democrats and Republicans who are negotiating the bipartisan infrastructure package. Senator Hassan appreciates and understands the impact that limiting Section 1031 like-kind exchanges would have on small apartment owners, pointing to the 1% vacancy rate in New Hampshire and the need for additional affordable housing.
Senator Bob Menendez (D-NJ) — Senator Menendez is often an advocate for the commercial real estate community. In addition to serving on the Finance Committee, he serves on the Banking Committee and chairs the Foreign Relations Committee. He is a trusted senior member of the Democratic leadership and has affirmed his ongoing support for Section 1031, pledging to serve as an advocate to ensure Section 1031 remains in its current form and is kept out of ongoing pay-for calculus.
Representative Brad Schneider (D-IL) — Congressman Schneider represents the suburbs north of Chicago and is a member of the Ways and Means Committee. The Congressman is a member of the moderate New Democrat Coalition, the pro-growth Blue Dog Coalition, and the bipartisan Problem Solvers Caucus. Congressman Schneider reassured us that Section 1031 has not come up as a potential pay-for in his conversations with Chairman Neal and Democratic Committee members, and he has promised to fight against changes to this important piece of tax code.
Representative Suzan DelBene (D-WA) — Congresswoman DelBene is a member of the House Ways and Means Committee and chairs the New Democrat Coalition. She has a long history with the IPA and a deep understanding of both Section 1031 and tax policy. Congresswoman DelBene has also met several times with President Biden and his advisors, including National Economic Advisor Brian Deese, Counselor to the President Steve Richetti, and Chief of Staff Ron Klain. The Congresswoman shared that the Ways and Means Committee has been spending a great deal of time on the recently agreed-to global minimum tax, which can be used as a pay-for for some of the President’s initiatives. She also shared that raising corporate and individual tax rates will be the most important pay-fors.
Including these meetings, IPA, alongside our coalition partners, has participated in more than 40 meetings with lawmakers on the House Ways and Means Committee and the Senate Finance Committee, including the Committees’ tax writing staff to discuss the importance of preserving like-kind exchanges in their current form. For more on the importance of our coalition work, please read my latest guest column in The DI Wire: Our Industry’s Role in the Coalition Fighting to Preserve Section 1031.
In September, our members will participate in another fly-in with key representatives, including Senator Catherine Cortez Masto (D-NV), and Reps. David Scott (D-GA), Jimmy Panetta (D-CA), Dan Kildee (D-MI), and Brian Higgins (D-NY).
To stay apprised of all like-kind exchange updates, visit our website dedicated to 1031 like-kind exchange advocacy, where you can directly engage with your members of Congress to support and preserve this important tax provision.
If you have any questions, please don’t hesitate to reach out to Tony or me.
SVP, Government Affairs and General Counsel
Institute for Portfolio Alternatives