Author Question: Suppose R wanted to put together a REIT trust for the duplexes. Would all his requirements be met? ... (Read 44 times)

james · **on:** Jun 24, 2018

Suppose R wanted to put together a REIT trust for the duplexes. Would all his requirements be met? What drawbacks exist?

Question 2

Beginning about 1998, Allan Fieldgrove leased farm land to Kenny Wilson (Kenny) under an oral year-to-year lease agreement, with an annual term from March 1 through the end of February each year. Rent was paid in cash. The most recent lease between Allan Fieldgrove and Kenny ran from March 1, 2007, through February 29, 2008. Kenny died on August 4, 2007. Cindy Wilson was the sole beneficiary of Kenny's estate. Mrs. Wilson and her sons continued farming the land after Kenny's death. On at least four occasions following Kenny's death, Mrs. Wilson or her sons communicated to Mr. Fieldgrove their intention to continue farming the land in 2008. Mr. Fieldgrove never gave written notice to any member of the Wilson family of his intention to terminate the farm lease. Mrs. Wilson and her sons kept farming the land during 2008. The original lease agreement between Kenny and Fieldgrove was:
A) A month-to-month tenancy.
B) A tenancy for years.
C) A periodic tenancy.
D) A tenancy at will.

Animal_Goddess · **Reply #1 on:** Jun 24, 2018

Answer to Question 1

To qualify for tax benefit treatment, R needs at least 100 investors - not worth the cost of setting up a REIT for 200,000. Also, investors could not deduct the loss, and the likelihood of an SEC exemption goes down with so many investors.

Answer to Question 2

C