Real Estate Investment Company
Same as term real estate investment trust (REIT): Type of investment company that invests money in mortgages and various types of investment in real estate, in order to earn profits for shareholders. Shareholders receive income from the rents received from the properties and receive capital gains as properties are sold at a profit. REITs have been formed by a number of large financial institutions such as banks and insurance companies. The stocks of many of them are traded on security exchanges, thereby providing investors with a marketable interest in real estate investment portfolio. By law, REITs have to distribute 95 percent of their income to shareholders, and in turn they are exempt from corporate taxes on income or gains. In exchange for this special tax treatment, REITs are subject to numerous qualifications and limitations including:
- Qualified asset and income tests. REITs are required to have at least 75% of their value represented by qualified real estate assets and to earn at least 75% of their income from real estate investments.
- Shareholder qualifications. Generally, REITs are not permitted to be closely held and must have a minimum of 100 shareholders.
Popular Real Estate Terms
Payment of the minimum tax by using legal tax planning opportunities such as estate planning. The use of tax avoidance strategies is a sound approach to retaining cash flow. On the other ...
A Construction method of using twice the number of framing members to provide additional structural strength. ...
A void property is a real estate property that is immediately available for new owners or renters as it is vacated. Void real estate properties can be occupied at a short notice as no ...
Right to property depends on some occurrence. ...
(1) Paved roadway constructed above lowlands such as a swamp. (2) Roadway in ancient Egypt connecting the valley temple with a pyramid. ...
Violating a law, commitment, duty, or obligation through commission or omission. The responsibilities of an agreement or guarantee are not met. ...
Roof with one side that is at a sloped angle. ...
Some real estate sales require court confirmation of purchase to protect heirs and debtors from financial wrongs. These sellers have to sell their property due to unique circumstances. They ...
Houses attached by either side of the same wall. ...
Have a question or comment?
We're here to help.