The IRS has adopted anti-abuse rules regarding the circumstances in which the integrity of a partnership is respected. If the existence of the partnership is not respected, it is likely that the IRS will take the position that partnership units are only a second class of REIT shares – and that the transfer of ownership to REIT in exchange for shares is taxable to the real estate owner. The structure of UPREIT is specifically addressed in examples in the anti-abuse rules. However, these examples do not apply to downREIT transactions. There may therefore be greater uncertainty about the tax situation of the downREIT. Another solution is to restructure the ownership of assets at the same time as the transfer of the partnership. .