Real estate investment trusts (“REITs”) allow individuals to invest in large-scale, income-producing real estate. A REIT is a company that owns and typically operates income-producing real estate or related assets. These may include office buildings, shopping malls, apartments, hotels, resorts, self-storage facilities, warehouses, and mortgages or loans.

Unlike other real estate companies, a REIT does not develop real estate properties to resell them. Instead, a REIT buys and develops properties primarily to operate them as part of its own investment portfolio.

In Missouri, as in other states, Real Estate Investment Trusts (REITs) are governed by federal tax law, specifically by the Internal Revenue Code (IRC). REITs must comply with certain IRS requirements to qualify as a REIT, such as investing at least 75% of total assets in real estate and deriving at least 75% of gross income from rents or mortgage interest. Missouri does not have specific statutes that uniquely regulate REITs; instead, they are treated like other corporations for state regulatory purposes. They must register with the Missouri Secretary of State if they are doing business in Missouri and comply with state corporate governance and securities laws. Additionally, REITs are subject to Missouri state taxes, but they are generally not taxed at the corporate level if they distribute at least 90% of their taxable income to shareholders as dividends. This allows REITs to avoid double taxation, once at the corporate level and again at the shareholder level.