Treasury Regulations Finalized Under FIRPTA Regarding Domestically Controlled REITs

Under U.S. tax law, gains recognized by foreign persons and entities upon the disposition of investments in certain U.S. assets (e.g., corporate stock and securities) are generally sourced outside of the United States and not subject to U.S. tax. An important exception exists, however, pursuant to the Foreign Investment in Real Property Tax Act of 1980, as amended (FIRPTA), where a foreign person sells real property located in the United States, or sells certain stocks or securities that derive most of their value from interests in U.S. real property. These assets are known as United States real property