PS Business Parks, Inc. Announces Tax Treatment of 2020 Dividends

Rhea-AI Summary

PS Business Parks, Inc. (NYSE:PSB) announced tax treatment for its 2020 dividends, stating that 100% of distributions for common and preferred stock were classified as ordinary income. No capital gain distributions were declared, and the dividends do not qualify as net capital gains. However, they are considered qualified REIT dividends under the Tax Cuts and Jobs Act provisions for non-corporate shareholders. This information is subject to adjustment and aims to assist in distributing Forms 1099. PSB owned 27.7 million rentable square feet and had a significant presence in the real estate market.

Positive

• 100% of 2020 dividends classified as ordinary income, potentially favorable for non-corporate shareholders.
• Dividends classified as qualified REIT dividends under the Tax Cuts and Jobs Act, enhancing tax efficiency for investors.

Negative

• No capital gain distributions declared, limiting potential tax benefits for shareholders.

PS Business Parks, Inc. (NYSE:PSB) announced today the tax treatment of the Company’s 2020 dividends. For the tax year ended December 31, 2020, 100% of the distributions for the common stock and all the various series of preferred stock for all four quarters were classified as ordinary income. The Company did not declare a capital gain distribution, nor did it have any undistributed long-term capital gain for 2020.

The ordinary income dividends are not “qualified dividend income” for purposes of determining dividends that are taxed as net capital gain.

For shareholders other than corporations, the ordinary dividends are “qualified REIT dividends” under the qualified business income provisions enacted as part of the Tax Cuts and Jobs Act of 2017.

This release is based on the preliminary results of work on the Company’s tax filings and is subject to correction or adjustment when the filings are completed. The Company is releasing information at this time to aid those required to distribute Forms 1099 on the Company’s distributions. No material change in this classification is expected.

If you have questions, please consult your tax advisor for further guidance.

Company Information

PS Business Parks, Inc., a member of the S&P MidCap 400, is a REIT that acquires, develops, owns, and operates commercial properties, primarily multi-tenant industrial, flex, and office space. As of December 31, 2020, the Company wholly owned 27.7 million rentable square feet with approximately 5,000 commercial customers in six states. The Company also held a 95.0% interest in a 395-unit apartment complex and a 98.2% interest in a development of a 411-unit multifamily apartment complex.

Additional information about PS Business Parks, Inc. is available on the Company’s website which can be found at psbusinessparks.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210119006177/en/

FAQ

What is the tax treatment of PSB's 2020 dividends?

For 2020, 100% of PSB's dividends were classified as ordinary income, with no capital gain distributions.

Are PSB dividends considered qualified dividend income?

No, the ordinary dividends are not classified as qualified dividend income for net capital gain tax purposes.

What type of dividends did PSB declare for 2020?

PSB declared ordinary income dividends for its common and preferred stocks, totaling 100% of distributions.

How do PSB's dividends affect non-corporate shareholders?

The dividends are considered qualified REIT dividends, which can benefit non-corporate shareholders under tax provisions.