BRAEMAR HOTELS & RESORTS ANNOUNCES TAX REPORTING INFORMATION FOR 2024 COMMON AND PREFERRED SHARE DISTRIBUTIONS

Rhea-AI Summary

Braemar Hotels & Resorts (NYSE: BHR) has released its tax reporting information for 2024 distributions on common and preferred shares. The company's common stock distributions amounted to $0.20 per share, classified as 100% ordinary taxable dividend. For preferred shares, distributions varied by series, with Series B at $1.3752, Series D at $2.0624, and Series E at $1.8750 per share. Multiple Series M preferred stock distributions ranged from $2.0729 to $2.1104 per share.

All preferred share distributions followed a consistent tax treatment pattern: approximately 75.51% as capital gain distribution and 24.49% as return of capital. The distributions paid on January 16, 2024, to stockholders of record as of December 29, 2023, are reportable in 2024, while distributions paid on January 15, 2025, will be reportable in 2025.

Insights

Tax and REIT Expert

The 2024 tax distribution breakdown for Braemar Hotels & Resorts provides important insights into the company's financial strategy and tax efficiency. The structure reveals sophisticated capital management, with several noteworthy implications for investors:

Common Stock Distribution Structure:

• The $0.20 per share annual distribution is entirely classified as ordinary taxable dividend
• This straightforward structure suggests these payments came directly from operational income

Preferred Share Distribution Pattern:

• Across all preferred series, approximately 75.51% is classified as capital gain distribution
• The remaining 24.49% is categorized as return of capital
• This consistent split across all preferred series indicates a deliberate tax strategy

The significant capital gain component in preferred distributions suggests substantial property appreciation or successful asset dispositions during 2024. The return of capital portion is particularly advantageous for investors as it reduces their cost basis rather than being immediately taxable, effectively providing tax-deferred returns.

This distribution structure indicates Braemar is effectively managing its REIT qualification requirements while optimizing shareholder tax efficiency. The absence of Section 199A dividends and the substantial capital gain component suggests the company may have executed strategic asset sales or reconfigurations during the year, rather than relying purely on operational income for distributions.

DALLAS, Jan. 27, 2025 /PRNewswire/ -- Braemar Hotels & Resorts Inc. (NYSE: BHR) ("Braemar" or the "Company") today announced the tax reporting (Federal Form 1099-DIV) information for the 2024 distributions on its common shares and its Series B, D, E and M preferred shares.

The amounts below represent the income tax treatment applicable to each distribution that is reportable in 2024. The common and preferred distributions that the Company paid on January 16, 2024 to stockholders of record as of December 29, 2023 are reportable in 2024. The common and preferred distributions that the Company paid on January 15, 2025 to stockholders of record as of December 31, 2024 (December 30, 2024 for the Company's Series B Cumulative Convertible Preferred Stock) will be reportable in 2025.

The income tax treatment for 2024 for Braemar Hotels and Resorts Inc. Common Stock CUSIP #10482B101 traded on the NYSE under ticker symbol "BHR" is as follows:  

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$0.2000000	$0.0000000	$0.0000000	$0.0000000	$0.2000000
Percent	100 %	0 %	0 %	0 %	100 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series B Cumulative Convertible Preferred Stock CUSIP #10482B200 traded on the NYSE under ticker symbol "BHRPrB" is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$1.3752000	$0.0000000	$0.0000000	$1.0383956	$0.3368044
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series D Cumulative Preferred Stock CUSIP #104823B09 traded on the NYSE under ticker symbol "BHRPrD" is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0624000	$0.0000000	$0.0000000	$1.5572914	$0.5051086
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series E Redeemable Preferred Stock (CUSIPs #10482B606, 10482B804, 10482B812, 10482B879, 10482B788, 10482B853 and 10482B838) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$1.8750000	$0.0000000	$0.0000000	$1.4157881	$0.4592119
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

Distributions Per Share reflects the annual rate per share for distributions reportable in 2024.

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B705) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.1104000	$0.0000000	$0.0000000	$1.5935356	$0.5168644
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B887) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.1041600	$0.0000000	$0.0000000	$1.5888239	$0.5153361
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B796) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0979200	$0.0000000	$0.0000000	$1.5841121	$0.5138079
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B861) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0916800	$0.0000000	$0.0000000	$1.5794004	$0.5122796
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B770) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0854400	$0.0000000	$0.0000000	$1.5746886	$0.5107514
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B846) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0792000	$0.0000000	$0.0000000	$1.5699769	$0.5092231
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

The income tax treatment for the 2024 distributions for Braemar Hotels and Resorts Inc. Series M Redeemable Preferred Stock (CUSIP #10482B820) is as follows:

Distribution Type
	Distributions Per Share	Ordinary Taxable Dividend	Section 199A Dividend	Capital Gain Distribution	Return of Capital
Total Cash Per Share	$2.0729500	$0.0000000	$0.0000000	$1.5652576	$0.5076924
Percent	100 %	0 %	0 %	75.50870 %	24.49130 %

Distributions Per Share reflects the annual rate per share for distributions reportable in 2024.

In accordance with IRS Code Section 6045B, the Company will post Form 8937, Report of Organizational Actions Affecting Basis of Securities, which may be found in the Corporate Actions section of the Company's website. This form provides detailed information on the return of capital amount of the common and preferred share distributions.

The Company encourages stockholders to consult with their own tax advisors with respect to the federal, state and local, and foreign income tax effects of these dividends.

Braemar Hotels & Resorts is a real estate investment trust (REIT) focused on investing in luxury hotels and resorts.

Forward-Looking Statements

Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include, among others, statements about the Company's strategy and future plans. These forward-looking statements are subject to risks and uncertainties. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to identify forward-looking statements. Such statements are subject to numerous assumptions and uncertainties, many of which are outside Braemar's control.

These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: our ability to repay, refinance or restructure our debt and the debt of certain of our subsidiaries; anticipated or expected purchases or sales of assets; our projected operating results; completion of any pending transactions; risks associated with our ability to effectuate our dividend policy, including factors such as operating results and the economic outlook influencing our board's decision whether to pay further dividends at levels previously disclosed or to use available cash to pay dividends; our understanding of our competition; market trends; projected capital expenditures; the impact of technology on our operations and business; general volatility of the capital markets and the market price of our common stock and preferred stock; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the markets in which we operate, interest rates or the general economy; and the degree and nature of our competition. These and other risk factors are more fully discussed in Braemar's filings with the Securities and Exchange Commission.

The forward-looking statements included in this press release are only made as of the date of this press release. Such forward-looking statements are based on our beliefs, assumptions, and expectations of our future performance taking into account all information currently known to us. These beliefs, assumptions, and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans, and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider this risk when you make an investment decision concerning our securities. Investors should not place undue reliance on these forward-looking statements. The Company can give no assurance that these forward-looking statements will be attained or that any deviation will not occur. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations, or otherwise, except to the extent required by law.

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SOURCE Braemar Hotels & Resorts, Inc.

FAQ

What is the tax treatment for BHR common stock distributions in 2024?

BHR common stock distributions in 2024 were $0.20 per share, classified as 100% ordinary taxable dividend.

How are BHR preferred share distributions taxed in 2024?

BHR preferred share distributions in 2024 are taxed as 75.51% capital gain distribution and 24.49% return of capital across all preferred series.

What is the distribution amount for BHR Series D preferred stock in 2024?

BHR Series D preferred stock distributions for 2024 amount to $2.0624 per share.

When will BHR's January 2025 distributions be reported for tax purposes?

BHR distributions paid on January 15, 2025, to stockholders of record as of December 31, 2024 (December 30, 2024 for Series B), will be reportable in 2025.