Redwood Trust, Inc. Announces Dividend Distribution Tax Information for 2012
MILL VALLEY, Calif., Jan. 30, 2013
MILL VALLEY, Calif., Jan. 30, 2013 /PRNewswire/ --Redwood Trust, Inc. (NYSE:
RWT) today announced tax information regarding its dividend distributions for
Shareholders should check the tax statements they receive from their brokerage
firms to confirm the Redwood dividend distribution information reported in
those statements conforms to the information reported here. Set forth in this
press release are Redwood's expectations with respect to federal income tax.
Shareholders should consult their tax advisors to determine the amount of
taxes that should be paid on Redwood's dividend distributions for federal,
state, and other income tax purposes.
All of the common stock dividend distributions paid during 2012 are reportable
on shareholders' 2012 federal income tax returns, including four $0.25 per
share quarterly regular dividend distributions. Thus, for 2012, Redwood
shareholders that held stock for this entire period should report a total of
$1.00 per share of common stock dividend distributions for federal income tax
Under the federal income tax rules applicable to real estate investment trusts
("REITs"), Redwood's 2012 dividend distributions are expected to be
characterized for income tax purposes as 77% ordinary income and 23% return of
capital. None of Redwood's 2012 dividend distributions are expected to be
characterized for federal income tax purposes as long-term capital gain
As a REIT, the portion of Redwood's dividend distributions that are
characterized as ordinary income under the applicable federal income tax rules
are generally taxed at full ordinary income tax rates. The portion of
Redwood's dividend distributions characterized as a return of capital under
the applicable federal income tax rules are not generally taxable (provided it
does not exceed a shareholder's tax basis in their Redwood shares), and it
reduces a shareholder's basis for shares held at each quarterly distribution
date (but not to below zero).
The table below provides more detailed information on the expected federal
income tax characterization for each of Redwood's common stock dividend
distributions that were paid for 2012.
Common Stock (CUSIP 758075 40 2)
Dividend Total Return Long-
Declaration Record Payable Distribution Ordinary of Term # of Total $
Dates Dates Dates Per Share Income Capital Gains Shares Paid
Regular 2/22/2012 3/15/2012 3/30/2012 $0.2500 $0.1931 $0.0569 $0.0000 78,544,682 $19,636,170
Regular 5/17/2012 6/15/2012 6/29/2012 $0.2500 $0.1931 $0.0569 $0.0000 79,067,916 $19,766,979
Regular 8/2/2012 9/14/2012 9/28/2012 $0.2500 $0.1931 $0.0569 $0.0000 81,358,847 $20,339,712
Regular 11/13/2012 12/14/2012 12/27/2012 $0.2500 $0.1931 $0.0569 $0.0000 81,564,812 $20,391,203
Total $1.0000 $0.7724 $0.2276 $0.0000 $80,134,064
For shareholders that are corporations, Redwood's dividend distributions are
not generally eligible for the corporate dividends-received deduction.
No portion of Redwood's 2012 dividend distributions are expected to consist of
unrelated business taxable income (UBTI), which is subject to specialized tax
reporting and other rules applicable for certain tax exempt investors.
In 2012, Redwood distributed dividends in excess of the minimum requirement
under the federal income tax rules applicable to REITs. For the 2012 taxable
year, after the application of the dividends paid deduction, Redwood does not
expect to report REIT taxable income on its federal income tax return.
However, Redwood and its qualified REIT subsidiaries expect to report
approximately $61.9 million in ordinary income (excluding the effect of the
dividends paid deduction) for the 2012 taxable year. Of the $61.9 million,
none is expected to be attributable to capital gains recognized for income tax
purposes. Under the federal income tax rules applicable to REITs, the
ordinary income (excluding the effect of the dividends paid deduction) is
expected to cause approximately $61.9 million of Redwood's 2012 dividend
distributions to be characterized for federal income tax purposes as ordinary
income to shareholders for 2012. None of the 2012 dividend distributions are
expected to be characterized as capital gains because, under the federal
income tax rules applicable to REITs, in determining the characterization of
dividend distributions, the REIT did not recognize net capital gains in 2012.
As used in this press release, "REIT taxable income" is that portion of total
taxable income that is earned at Redwood Trust, Inc. and its qualified REIT
subsidiaries. Redwood's 2012 federal income tax return is expected to be
filed with the Internal Revenue Service in September 2013.
For more information about Redwood Trust, Inc., please visit our website at:
Cautionary Statement: This press release contains forward-looking statements
within the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve numerous
risks and uncertainties. Our actual results may differ from our beliefs,
expectations, estimates, and projections and, consequently, you should not
rely on these forward-looking statements as predictions of future events.
Forward-looking statements are not historical in nature and can be identified
by words such as "anticipate," "estimate," "will," "should," "expect,"
"believe," "intend," "seek," "plan" and similar expressions or their negative
forms, or by references to strategy, plans, or intentions. These
forward-looking statements are subject to risks and uncertainties, including,
among other things, (i) that the expectations described herein change when
Redwood's 2012 federal income tax return is completed and filed in 2013 and
(ii) the other risks and uncertainties described in our Annual Report on Form
10-K for the year ended December 31, 2011, under the caption "Risk Factors."
Other risks, uncertainties, and factors that could cause actual results to
differ materially from those projected may be described from time to time in
reports we file with the Securities and Exchange Commission (SEC), including
reports on Forms 10-Q and 8-K. We undertake no obligation to update or revise
any forward-looking statements, whether as a result of new information, future
events, or otherwise.
Statements regarding the following subjects, among others, are forward-looking
by their nature: (i) the expected characterization for federal income tax
purposes of Redwood's 2012 dividend distributions, and (ii) the expectation
that Redwood will report approximately $61.9 million in ordinary income
(excluding the effect of the dividends paid deduction) for the 2012 taxable
year and the expectation that none of that amount will be attributable to
capital gains recognized for income tax purposes.
SOURCE Redwood Trust, Inc.
Contact: Mike McMahon Managing Director +1-415-384-3805
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