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A real estate investment trust (REIT) is any corporation, trust or association that acts as an investment agent specializing in real estate and real estate mortgages (Code Sec. 856 ¶ 26,500). REITs may escape corporation taxation because, unlike ordinary corporations, they are entitled to claim a deduction for dividends paid to shareholders against their ordinary income and net capital gains. An organization entity qualifies as a REIT if it makes an election to be treated as such by filing a tax return on Form 1120-REIT and it meets certain requirements as to ownership and organization, source of income, investment of assets, and distribution of income to shareholders.

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Q: What does REIT mean?
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