The tax bill's most notable provision regarding REITs eliminates an obstacle for foreign investors in publicly traded US REIT stocks; an obstacle that has clearly limited the amount of such investments in the past. Now, overseas REIT investors in possession of less than 5% of a US REIT will be subject to the same filing and tax rules as foreign investors in other US corporations.

"There's been a fairly small amount of overseas investments in US REITs, with a few exceptions, like some Dutch institutions; but they are so large and have their own US-based representatives," Tony M. Edwards, NAREIT senior vice president and general counsel, tells GlobeSt.com. "There are no hard statistics, but anecdotally, we've been told that the rules that have been removed will spur significant overseas investments in REITs."

Additionally, the new provisions in the bill replace the threat of REIT status removal due to violations with monetary penalties. "Lawmakers concluded that no company should be subject to the loss of REIT status in the event of unintentionally failing to meet certain tax tests," Edwards notes in a statement. "REIT executives expend significant resources to avoid such a drastic result. Therefore, the new law builds flexibility into the REIT rules to conform them to common-sense standards."