05/04/2026
Dear Francis Newsletter
Tax Considerations for Data Center Projects in the Age of AI
Tax and Financial News
May, 2026
Artificial intelligence is driving an unprecedented surge in data center construction. Developers, private equity sponsors and their tax advisors are navigating a complicated web of questions that touch everything from ownership structure to site selection to power sourcing. Get the early decisions wrong and the tax consequences can follow a project for years.
Why REITs Have Become the Structure of Choice
Private equity has increasingly turned to real estate investment trusts when backing data center projects. Structure a REIT correctly, and you sidestep corporate-level taxation entirely. Foreign investors get an even better deal. Sovereign wealth funds and foreign pension funds can participate without any obligation to file U.S. tax returns. Data centers, with their heavy real estate footprint, slot into the REIT framework more naturally than many other asset classes.
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Understanding the EV/2P Ratio
General Business News
May, 2026
When it comes to raw materials, especially for fossil fuels, it’s essential to evaluate existing and potential production capabilities for such companies. Using the EV/2P Ratio is a powerful tool when evaluating fossil fuel-related companies.
Defining the Ratio
This ratio is calculated by dividing a business’ enterprise value into the company’s reserves. It provides financial analysts, investors and internal business stakeholders with a snapshot of a company’s reserves and the business’ likelihood of preserving operation growth. This standardizes valuations, thereby allowing analysts to compare company-to-company financials.
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6 Tips for Your Mid-Year Check In
Tip of the Month
May, 2026
It might be hard to believe, but yes, it’s almost the middle of the year and the perfect time to take a look at how you’re doing financially: are you fiscally fit or do you need a few adjustments? Whether it’s saving more, paying down debt, or prepping for retirement, you still have time to effect change. Here are a few ways to get started.
Review Your 2026 Financial Goals
Kind of a no-brainer, but ask yourself:
- Have I saved as much as I planned?
- How’s my progress at paying off debt?
- Have my priorities changed since the new year?
In addition to these things, other important goals might include building your emergency fund (broken dishwasher, for instance); saving for a vacation; and finally, the certainty no one can escape – tax preparation.
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WHAT WE DO?
At A Francis + Associates, we assist our tax clients through efficient compliance and effective planning to help them realize substantial savings. We use a team approach and focus on timely communication to provide our clients with excellent service. Tax partner and specialist involvement ensure that our clients receive the most experienced technical expertise we have to offer.
