Lineage, Inc. Announces Tax Treatment for 2024 Distributions

Rhea-AI Summary

Lineage (NASDAQ: LINE), the world's largest global temperature-controlled warehouse REIT, has disclosed the tax treatment of its 2024 distributions. The company's Q3 cash distribution of $0.38 per share, paid on October 21, 2024, was classified entirely as return of capital, including a $0.0003 per share section 897 look-through distribution gain.

The company's fourth quarter 2024 dividend of $0.5275 per share, paid in calendar year 2025, will be included in shareholders' 2025 distributions and is not included in the 2024 Form 1099-DIV. The company advises shareholders to consult tax advisors regarding federal, state, and local income tax implications of these distributions.

Insights

Tax and REIT Expert

The tax treatment of Lineage's 2024 distributions reveals significant implications for shareholders. The $0.38 per share distribution being classified as return of capital rather than dividend income has unique tax consequences. This classification means shareholders won't need to pay immediate taxes on these distributions, but instead must reduce their cost basis in the stock by the distribution amount.

A key insight is that return of capital distributions are relatively uncommon for REITs, which typically must distribute at least 90% of their taxable income as dividends. This treatment suggests Lineage's tax accounting structure effectively managed their taxable income for 2024, potentially through depreciation and other tax-advantaged strategies.

For investors, this has several important implications:

• The reduced cost basis will result in larger capital gains (or smaller losses) when shares are eventually sold
• Tax liability is effectively deferred until the stock is sold, providing a timing advantage for tax planning
• Foreign investors should note the minimal $0.0003 per share section 897 look-through gain, which has specific FIRPTA implications

The upcoming Q4 2024 dividend of $0.5275 per share, payable in 2025, represents a significant increase from the previous distribution, indicating potential strength in the company's operating performance. However, its tax treatment won't be determined until next year's announcement.

This tax-efficient distribution structure demonstrates sophisticated financial management and could be particularly attractive to investors in higher tax brackets seeking to defer income recognition. The treatment also suggests strong cash flow generation relative to taxable income, often a positive indicator for REITs.

NOVI, Mich.--(BUSINESS WIRE)-- Lineage, Inc. (NASDAQ: LINE) (the "Company"), the world’s largest global temperature-controlled warehouse REIT, today announced the tax treatment of its 2024 distributions. The tax treatment of distributions per share of the Company common stock (CUSIP 53566V106) will be reported on the Form 1099-DIV as follows:

Record Date

Payable Date

Cash Distribution

Ordinary Dividend

Qualified Dividend

Capital Gain Distribution

Return of Capital*

Section 199A Dividend

9/30/2024

10/21/2024

$0.38

$0.00

$0.00

$0.00

$0.38

$0.00

* For purposes of section 897(h)(1) of the Internal Revenue Code, the Company is disclosing the return of capital distribution includes $0.0003 per share of section 897 look-through distribution gain.

The Company paid its fourth quarter 2024 dividend of $0.5275 per share in calendar year 2025. The 2024 fourth quarter dividend will be included with the shareholders’ 2025 distributions and is not included on the 2024 Form 1099-DIV.

The information in this document represents the Company’s understanding of the U.S. federal income tax laws and regulations and does not constitute tax advice. It does not purport to be complete or to describe the consequences that may apply to particular categories of stockholders. Please also note that state and local taxation of REIT distributions may differ from federal rules. The Company recommends consultation with a tax advisor regarding the federal, state, and local income tax consequences of these distributions.

About Lineage

Lineage, Inc. (NASDAQ: LINE) is the world’s largest global temperature-controlled warehouse REIT with a network of over 480 strategically located facilities totaling over 84 million square feet and approximately 3.0 billion cubic feet of capacity across countries in North America, Europe, and Asia-Pacific. Coupling end-to-end supply chain solutions and technology, Lineage partners with some of the world’s largest food and beverage producers, retailers, and distributors to help increase distribution efficiency, advance sustainability, minimize supply chain waste, and, most importantly, feed the world. Learn more at onelineage.com and join us on LinkedIn , Facebook , Instagram , and X.

Forward-Looking Statements

Certain statements contained in this press release may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Lineage intends for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in those acts. Such forward-looking statements can generally be identified by Lineage’s use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” “seek,” “objective,” “goal,” “strategy,” “plan,” “focus,” “priority,” “should,” “could,” “potential,” “possible,” “look forward,” “optimistic,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Such statements are subject to certain risks and uncertainties, including known and unknown risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of Lineage’s performance in future periods. Except as required by law, Lineage does not undertake any obligation to update or revise any forward-looking statements contained in this release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250123556174/en/

Investor Relations Contact

Evan Barbosa

VP, Investor Relations

ir@onelineage.com

Media Contact

Megan Hendricksen

VP, Global Marketing & Communications

pr@onelineage.com

Source: Lineage, Inc.

FAQ

What is the tax treatment of Lineage's Q3 2024 distribution of $0.38 per share?

Lineage's Q3 2024 distribution of $0.38 per share is classified entirely as return of capital, with $0.0003 per share being section 897 look-through distribution gain.

When will Lineage's Q4 2024 dividend of $0.5275 be reported for tax purposes?

Lineage's Q4 2024 dividend of $0.5275 will be included in shareholders' 2025 distributions as it was paid in calendar year 2025.

What is the qualified dividend portion of Lineage's Q3 2024 distribution?

Lineage's Q3 2024 distribution contained no qualified dividend portion ($0.00).

How much of Lineage's Q3 2024 distribution qualifies as Section 199A dividend?

None of Lineage's Q3 2024 distribution qualifies as Section 199A dividend ($0.00).