Anton Troianovski of The Wall Street Journal does some heavy lifting in today's edition, unpacking "tenant-in-common" leases and how they can be used fraudulently.
That requires explaining tax law in concise plain language, with he does very effectively while also explaining the details of multiple complex frauds.
The dispute sheds light on the fallout from the last decade's rush by individual investors to get a piece of the commercial real-estate market. These deals were fueled by a 2002 ruling by the Internal Revenue Service that made it easy for investors to use TIC deals to take advantage of a rule allowing capital-gains taxes to be deferred when selling a property by reinvesting the proceeds in another property.
In such a structure, a handful of investors each buys a slice of a property, typically organized by a sponsoring company that finds deals and brings investors together. More than $14 billion in TIC equity has been raised since 2002, according to Omni Real Estate Services, a TIC brokerage and research firm in Salt Lake City.
These stories are corrections waiting to happen, with all the overlapping details and sensitive subject matters so it's worth flagging.
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