Leveraged Firms Aim to Skirt Write-Off Limit as Real Estate (1)

Leveraged manufacturers and health care providers are looking for a way around the 2017 tax overhaul’s limit on debt interest payment write-offs. One potential option: calling themselves real estate.

That might entail stretching the definition of a “real property trade or business,” a category of companies that can elect out of the restriction on deductions of interest expenses, which the law capped at 30 percent of adjusted taxable income under amended tax code Section 163(j). They would avoid both the limit on interest deductions and what could be a tedious compliance process, at the cost of losing ...