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As special creatures of the tax law, REITs are surrounded by a thicket of specific rules for achieving and maintaining their status. Economic and market forces are now trending toward consolidation of REITs or their acquisition by non-REIT entities. Practitioners will have to integrate the general provisions of the Code affecting corporate, mergers and acquisitions with the rules governing REITs.

The Revenue Reconciliation Act of 1993 (RRA '93) includes tax incentives to encourage business investment and hiring in economically depressed areas. Few businesses are likely to find these incentives useful. RRA '93 allows for empowerment zones and enterprise communities in depressed localities including Indian reservations. RRA '93 also allows for job credits and tax-exempt enterprise zone facilities bonds. However, the complex criteria for deciding which areas are eligible for designation and which businesses are eligible for tax incentives will discourage use of this law.

Proposed regulations governing deferred like-kind exchanges and installment sales clarify treatment areas and open many planning opportunities but create questions concerning the use of a qualified intermediary. Deferred like-kind exchanges are defined as exchanges of property held for productive trade or business use or investment. The installment accounting method is used if deferred exchange boot is received in the second year. If the installment note is held by someone other than the purchaser, the installment method cannot be used, with no guidance for qualified intermediaries.