real estate news SOURCE OF INCOME A NEW PROTECTED CLASS Senator Orrin Hatch & Senator Tim Kaine have introduced a bill named Fair Housing Improvement Act of 2018 S3612. This bill, while unlikely to move due to its late introduction, does raise a very concerning issue, specifically that of adding two more protected classes: Source of Income and Veterans. This bill is being watched closely and is unlikely to even make it to a committee hearing, but it has been assigned. The Act amends the Fair Housing Act to 'prohibit discrimination based on the source of income or veteran status.' Why this is very concerning is that it would make source of income, like Section 8 Housing Vouchers a protected class, like Race, Religion or Disability among others. So a person who rents a home would not have a choice in renting to someone with a voucher. And should that someone have some sort of life change: get a better job and earn more money or have a child reach the age of 18, they could lose all or part of their voucher and no longer be able to afford your home. If you invest in Kansas City, the City Council is also considering making source of income in the way of housing vouchers a protected class. Be sure to follow the MAREI Blog at MAREI.org to stay up to date on this and other issues facing Real Estate Investors in Kansas City.
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OPPORTUNITY ZONES Perhaps, one of the greatest opportunities for real estate investors of all types to come along in quite some time and something we are going to be hearing about quite a bit in the near future. What is an Opportunity Zone? Created by the Tax Cuts and Jobs Act in 2017, an Opportunity Zone, is an economicallydistressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Localities qualify as Opportunity Zones if they have been nominated for that designation by the state and that nomination has been certified by the Secretary of the U.S. Treasury via his delegation of authority to the Internal Revenue Service. They are an economic development tool— designed to spur economic development by providing tax benefits to investors.
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First, investors can defer tax on any capital gains from the sale of an asset by investing those gains into a Qualified Opportunity Fund (these are funds created to invest in Qualified Opportunity Zones) Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged. Grow Your Business
