Real Estate Investment Trust Tax Act

Real Estate Investment Trust Tax Act - Provides, under the Internal Revenue Code, that if a determination with respect to a real estate investment trust results in any adjustment for any taxable year, a deduction shall be allowed for the amount of deficiency dividends for purposes of determining the deduction for dividends paid for such year. Sets forth the rules governing the application of such provision, including: (1) definition of the term "adjustment"; (2) interest and penalties based on the full amount of adjustment; (3) the amount of adjustment attributable to a determination; (4) the effect on shareholders or holders of beneficial interests; and (5) definitions of "determination" and "deficiency dividends".

Provides that any real estate investment trust which is liable for interest for any period by reason of any determination with respect to which a deduction is allowed shall pay a penalty in an amount equal to the amount of such interest attributable solely to such determination. Requires the imposition of a tax in cases of a determination of failure to meet specified requirements.

Prescribes rules for the treatment of foreclosure property with respect to a grace period and extensions and terminations of such grace period. Provides that property shall be treated as foreclosure property only if the real estate investment trust so elects on or before the due date for filing its return of tax.

Imposes for each taxable year on the net income from foreclosure property and other property of every real estate investment trust a tax as if such income constituted the taxable income of a corporation. Increases the 90-percent gross income requirement to 95 percent. Defines the terms "rents from real property" and "independent contractor".

Provides that real estate investment trusts may be incorporated. Makes technical and conforming amendments. Sets forth the effective dates for the provisions of this Act.