REIT shareholders include in income the distributions received from the REIT, either as ordinary income or capital gains (depending on the REIT-level characterization of the funds) or as a return of capital. In their column in the Journal of Passthrough Entities, Kevin Shields and Daniel Cullen explain what portion of dividends, if any, is “sheltered” or constitutes the economic equivalent of tax deferral.
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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.
Read this article from CCH’s Journal of Taxation of Financial Products