Trust me, the IRS doesn't care what you call something, if they want to call it something different.
PZN's declarations of which dividend is which is basicially irrelevant. The Internal Revenue Code (not the IRS) has specifice rules governing the characterization of distributions to stockholders, including the ordering of the payments. In most cases that I'm aware of, dividends are treated as coming out of current earnings first, then accumulated earnings, then a return of capital. I guess the REIT rules switch it around. That in itself isn't a big deal, but I'm surprised that PZN didn't know the rules. Actually, the ordering rules wouldn't have mattered, I guess, had all the dividends been paid out during 1999. The real message is that they have decided NOT to pay everything during this calendar year, and now ordering has some significance. I'm just a little curious how the debt agreement is affected by all this.