Sweeping tax reform legislation that lowered tax rates and sought to eliminate many of the loopholes in the tax laws.
Sweeping revisions of income tax laws, lowering tax rates but eliminating many tax shelters.
Federal law that substantially altered the real estate investment landscape by permitting REITs not only to own, but also to operate and manage, most types of income-producing commercial properties. It also stopped real estate "tax shelters" that had attracted capital from investors based on the amount of losses that could be created.
The Tax Reform Act of 1986 (TRA86) is most noted for its imposition of passive loss limitations on limited partners. Prior to 1986, the tax laws permitted losses generated from passive investment activities to be applied to offset ordinary income. TRA86 changed the rules, limiting the application of passive losses to the offset of passive activity income (for most taxpayers) and, as a result, severely limiting the tax shelter advantages available prior to passage of TRA86.
Federal legislation that modified many significant aspects of the U.S. tax system.
Tax Reform Act of 1993 tax refund
The U.S. Congress passed the Tax Reform Act (TRA) of 1986, (, , October 22, 1986) to simplify the income tax code, broaden the tax base and eliminate many tax shelters and other preferences. Although often referred to as the second of the two "Reagan tax cuts" (the Kemp-Roth Tax Cut of 1981 being the first), the bill was actually officially sponsored by two liberal Democrats, Richard Gephardt of Missouri in the House of Representatives and Bill Bradley of New Jersey in the Senate.