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iShares Mortgage Real Estate Capped Message Board

  • ltbhdollars ltbhdollars Aug 7, 2012 12:21 PM Flag

    Dividend Type

    Are REM dividends just pass through and taxed as REIT dividends or are they qualified since paid by an ETF??


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    • Thx, yes helps ... for me it will be an IRA add rather than the taxable account due to the higher tax rate for ordinary classification.


    • The ETF pays the dividend, but in either case it would be the same difference.

      Still a dividend. It holds mREITs, not a BDCs or MLPs or CEFs, which you may be thinking of.

      • 1 Reply to retaoba
      • Thx for your reply.

        First let me apologize for a sloppy (rushed) Subject Title, in that REM pays a distribution which could have income, interest, short and long term gain components, as well as ROC.

        Of course each of these carry their own tax classification, I am concerned with what would be the REIT income component.

        You may not know that a Regulated Investment Company or RIC is a mutual fund or real estate investment trust that is eligible to pass the taxes on capital gains, dividends, or interest payments onto the clients or individual investors.

        FWIW, both mReits and BDCs are RICs and consequently pass on the full taxability of any payments to their individual investors ... in this instance all REMs holdings pass on the tax consequences to REM.

        Since I am not familiar with REM, my question was whether REM's tax structure allows it to recharacterize payments made by its holdings from non qualified to qualified.

        Asking same question in a different manner ... are your REM payments classified as qualified or not??


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