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Corrections Corporation of America Message Board

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  • RetiredPaperman RetiredPaperman May 18, 1999 8:43 PM Flag

    A simple and elegant solution

    That won't satisfy the tax law requirements.
    Understand that the REIT tax laws DON'T stipulate that a
    company has to pay a special dividend. They stipulate
    that if there are retained earnings they must be paid
    out to the extent that they are taken to zero.
    Issuing additional stock does not reduce retaining
    earnings. Retained Earnings are reduced either by dividend
    payments or incurring losses.

    The above is my
    understanding anyway. I'm not a CPA or Tax Attorney.

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