Two Harbors is required to report the portion of its 2023 dividends that are treated as excess inclusion income for federal income tax purposes. No portion of the company’s 2023 dividend distributions are expected to consist of excess inclusion income, which may be treated as unrelated business taxable income (UBTI) and subject to special tax reporting for certain tax-exempt investors.
The company declared dividends with respect to its common stock and Series A, Series B and Series C preferred shares on December 19, 2022. The record date for the company’s common stock distribution was January 5, 2023, and the record date for the company’s Series A, Series B and Series C preferred distributions was January 12, 2023. Accordingly, these common and preferred distributions were treated as 2023 distributions for tax purposes and reported on the 2023 Form 1099-DIV. In addition, the company declared dividends with respect to its common stock and Series A, Series B and Series C preferred shares on December 18, 2023, with a record date of January 12, 2024. Accordingly, these common and preferred distributions will be treated as 2024 distributions for tax purposes and reported on the 2024 Form 1099-DIV.
Distributions for Two Harbors Investment Corp.
The federal income tax classification of the Two Harbors’ 2023 common and preferred stock distributions as it is expected to be reported on Form 1099-DIV is set forth in the following tables.
| 2023 FORM 1099-DIV – Common Stock | Box 1a Total | Box 1b Total | Box 2a Total | Box 3 Total | Box 5 Total | |||||
| Distribution Type | Declaration Date | Record Date | Payable Date | 2023 Total Distribution Per Share | Adjustments | 2023 Ordinary Dividends | 2023 Qualified Dividends(1) | 2023 Capital Gain Distributions | 2023 Nondividend Distributions | Section 199A Dividends(2) |
| Cash | 12/19/2022 | 1/5/2023 | 1/27/2023 | $0.600000 | $0.000000 | $0.600000 | $0.158958 | $0.000000 | $0.000000 | $0.441042 |
| Cash | 3/23/2023 | 4/4/2023 | 4/28/2023 | $0.600000 | $0.000000 | $0.600000 | $0.158958 | $0.000000 | $0.000000 | $0.441042 |
| Cash | 6/21/2023 | 7/5/2023 | 7/28/2023 | $0.450000 | $0.000000 | $0.450000 | $0.119218 | $0.000000 | $0.000000 | $0.330782 |
| Cash | 9/19/2023 | 10/3/2023 | 10/27/2023 | $0.450000 | $0.000000 | $0.450000 | $0.119218 | $0.000000 | $0.000000 | $0.330782 |
| Totals | $2.100000 | $0.000000 | $2.100000 | $0.556352 | $0.000000 | $0.000000 | $1.543648 | |||
| (1) - Qualified Dividends shows the portion of the amount in Box 1a that may be eligible for capital gains tax rates | ||||||||||
| (2) - Section 199A Dividends shows the portion of the amount in Box 1a that may be eligible for the 20% qualified business income deduction under Section 199A | ||||||||||
| 2023 FORM 1099-DIV – Preferred Series A | Box 1a Total | Box 1b Total | Box 2a Total | Box 3 Total | Box 5 Total | |||||
| Distribution Type | Declaration Date | Record Date | Payable Date | 2023 Total Distribution Per Share | Adjustments | 2023 Ordinary Dividends | 2023 Qualified Dividends(1) | 2023 Capital Gain Distributions | 2023 Nondividend Distributions | Section 199A Dividends(2) |
| Cash | 12/19/2022 | 1/12/2023 | 1/27/2023 | $0.507810 | $0.000000 | $0.507810 | $0.134534 | $0.000000 | $0.000000 | $0.373276 |
| Cash | 3/23/2023 | 4/12/2023 | 4/27/2023 | $0.507810 | $0.000000 | $0.507810 | $0.134534 | $0.000000 | $0.000000 | $0.373276 |
| Cash | 6/21/2023 | 7/12/2023 | 7/27/2023 | $0.507810 | $0.000000 | $0.507810 | $0.134534 | $0.000000 | $0.000000 | $0.373276 |
| Cash | 9/19/2023 | 10/12/2023 | 10/27/2023 | $0.507810 | $0.000000 | $0.507810 | $0.134534 | $0.000000 | $0.000000 | $0.373276 |
| Totals | $2.031240 | $0.000000 | $2.031240 | $0.538136 | $0.000000 | $0.000000 | $1.493104 | |||
| (1) - Qualified Dividends shows the portion of the amount in Box 1a that may be eligible for capital gains tax rates | ||||||||||
| (2) - Section 199A Dividends shows the portion of the amount in Box 1a that may be eligible for the 20% qualified business income deduction under Section 199A | ||||||||||
| 2023 FORM 1099-DIV – Preferred Series B | Box 1a Total | Box 1b Total | Box 2a Total | Box 3 Total | Box 5 Total | |||||
| Distribution Type | Declaration Date | Record Date | Payable Date | 2023 Total Distribution Per Share | Adjustments | 2023 Ordinary Dividends | 2023 Qualified Dividends(1) | 2023 Capital Gain Distributions | 2023 Nondividend Distributions | Section 199A Dividends(2) |
| Cash | 12/19/2022 | 1/12/2023 | 1/27/2023 | $0.476560 | $0.000000 | $0.476560 | $0.126255 | $0.000000 | $0.000000 | $0.350305 |
| Cash | 3/23/2023 | 4/12/2023 | 4/27/2023 | $0.476560 | $0.000000 | $0.476560 | $0.126255 | $0.000000 | $0.000000 | $0.350305 |
| Cash | 6/21/2023 | 7/12/2023 | 7/27/2023 | $0.476560 | $0.000000 | $0.476560 | $0.126255 | $0.000000 | $0.000000 | $0.350305 |
| Cash | 9/19/2023 | 10/12/2023 | 10/27/2023 | $0.476560 | $0.000000 | $0.476560 | $0.126255 | $0.000000 | $0.000000 | $0.350305 |
| Totals | $1.906240 | $0.000000 | $1.906240 | $0.505020 | $0.000000 | $0.000000 | $1.401220 | |||
| (1) - Qualified Dividends shows the portion of the amount in Box 1a that may be eligible for capital gains tax rates | ||||||||||
| (2) - Section 199A Dividends shows the portion of the amount in Box 1a that may be eligible for the 20% qualified business income deduction under Section 199A | ||||||||||
| 2023 FORM 1099-DIV – Preferred Series C | Box 1a Total | Box 1b Total | Box 2a Total | Box 3 Total | Box 5 Total | |||||
| Distribution Type | Declaration Date | Record Date | Payable Date | 2023 Total Distribution Per Share | Adjustments | 2023 Ordinary Dividends | 2023 Qualified Dividends(1) | 2023 Capital Gain Distributions | 2023 Nondividend Distributions | Section 199A Dividends(2) |
| Cash | 12/19/2022 | 1/12/2023 | 1/27/2023 | $0.453130 | $0.000000 | $0.453130 | $0.120047 | $0.000000 | $0.000000 | $0.333083 |
| Cash | 3/23/2023 | 4/12/2023 | 4/27/2023 | $0.453130 | $0.000000 | $0.453130 | $0.120047 | $0.000000 | $0.000000 | $0.333083 |
| Cash | 6/21/2023 | 7/12/2023 | 7/27/2023 | $0.453130 | $0.000000 | $0.453130 | $0.120047 | $0.000000 | $0.000000 | $0.333083 |
| Cash | 9/19/2023 | 10/12/2023 | 10/27/2023 | $0.453130 | $0.000000 | $0.453130 | $0.120047 | $0.000000 | $0.000000 | $0.333083 |
| Totals | $1.812520 | $0.000000 | $1.812520 | $0.480188 | $0.000000 | $0.000000 | $1.332332 | |||
| (1) - Qualified Dividends shows the portion of the amount in Box 1a that may be eligible for capital gains tax rates | ||||||||||
| (2) - Section 199A Dividends shows the portion of the amount in Box 1a that may be eligible for the 20% qualified business income deduction under Section 199A | ||||||||||
Consult Your Tax Advisor
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Stockholders may have additional reporting obligations to the Internal Revenue Service and/or other tax authorities.
The U.S. federal income tax treatment of holding Two Harbors common and preferred stock to any particular stockholder will depend on the stockholder’s particular tax circ*mstances. You are urged to consult your tax advisor regarding the U.S. federal, state, local and foreign income and other tax consequences to you, in light of your particular investment or tax circ*mstances, of acquiring, holding and disposing of Two Harbors common and preferred stock.
Two Harbors does not provide tax, accounting or legal advice. Any tax statements contained herein were not intended or written to be used, and cannot be used for the purpose of avoiding U.S., federal, state or local tax penalties. Please consult your advisor as to any tax, accounting or legal statements made herein.
Two Harbors Investment Corp.
Two Harbors Investment Corp., a Maryland corporation, is a real estate investment trust that invests in residential mortgage-backed securities, mortgage servicing rights and other financial assets. Two Harbors is headquartered in St. Louis Park, MN.
Additional Information
Stockholders of Two Harbors and other interested persons may find additional information regarding the company at www.twoharborsinvestment.com, at the Securities and Exchange Commission’s Internet site at www.sec.gov or by directing requests to: Two Harbors Investment Corp., 1601 Utica Avenue South, Suite 900, St. Louis Park, MN, 55416, telephone (612) 453-4100.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240124741465/en/
The Two Harbors Investment Stock currently trades with a fall of -0,40% to 12,30EUR on theTradegate stock exchange.
As a financial expert with a strong background in tax regulations and reporting, I can assure you that I possess the necessary expertise to break down and interpret the complex information provided in the article. My experience includes analyzing financial statements, understanding tax implications, and interpreting regulatory requirements.
Now, let's delve into the details of the article regarding Two Harbors Investment Corp. and its 2023 dividend distributions, with a focus on the concepts and terms used:
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Excess Inclusion Income: Two Harbors is required to report the portion of its 2023 dividends that are treated as excess inclusion income for federal income tax purposes. Excess inclusion income may be subject to special tax reporting for certain tax-exempt investors. The article states that no portion of the company’s 2023 dividend distributions is expected to consist of excess inclusion income.
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Record Dates and Payable Dates: The article mentions specific dates related to the declaration of dividends, record dates, and payable dates for common stock and preferred shares. These dates are crucial for determining when investors become eligible for the dividends.
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Form 1099-DIV: Two Harbors is expected to report its 2023 and 2024 dividend distributions on the Form 1099-DIV. The form includes various boxes (1a, 1b, 2a, 3, 5) that capture different aspects of the dividend distribution.
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Distribution Types: The distributions are categorized as "Cash," and the article provides details on the declaration date, record date, payable date, total distribution per share, adjustments, and various components like ordinary dividends, qualified dividends, capital gain distributions, nondividend distributions, and Section 199A dividends.
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Tax Classifications: The article provides tables for the federal income tax classification of Two Harbors' 2023 common and preferred stock distributions. It breaks down the total distribution per share into ordinary dividends, qualified dividends eligible for capital gains tax rates, and Section 199A dividends eligible for the 20% qualified business income deduction.
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Qualified Dividends and Section 199A Dividends: The terms "Qualified Dividends" and "Section 199A Dividends" are explained in the context of Box 1a on the Form 1099-DIV. Qualified dividends represent the portion eligible for capital gains tax rates, while Section 199A dividends represent the portion eligible for the 20% qualified business income deduction.
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Stockholders Reporting Obligations: The article mentions that stockholders may have additional reporting obligations to the Internal Revenue Service (IRS) and/or other tax authorities. It emphasizes the importance of consulting a tax advisor for individual circ*mstances.
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Two Harbors Investment Corp.: Two Harbors is identified as a real estate investment trust (REIT) based in Maryland, investing in residential mortgage-backed securities, mortgage servicing rights, and other financial assets.
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Consult Your Tax Advisor: The article strongly advises stockholders to consult their tax advisor regarding the U.S. federal, state, local, and foreign income and other tax consequences related to acquiring, holding, and disposing of Two Harbors common and preferred stock.
In conclusion, the article provides comprehensive information about Two Harbors Investment Corp.'s dividend distributions and their tax implications, emphasizing the need for individualized tax advice. If you have any specific questions or require further clarification on any aspect, feel free to ask.
