Income Taxes	3 Months Ended
Sep. 30, 2011
Notes to Financial Statements
Income Taxes	Note 15. Income Taxes Capital Trust, Inc. has made an election to be taxed as a REIT under Section 856(c) of the Internal Revenue Code, commencing with the tax year ending December 31, 2003. As a REIT, we generally are not subject to federal, state, and local income taxes except for the operations of our taxable REIT subsidiary, CTIMCO. To maintain qualification as a REIT, we must distribute at least 90% of our annual REIT taxable income to our shareholders and meet certain other requirements. If we fail to maintain our qualification as a REIT, we may be subject to material penalties as well as federal, state and local income tax on our taxable income at regular corporate rates. As of September 30, 2011 and December 31, 2010, Capital Trust, Inc. was in compliance with all REIT requirements. In addition, Capital Trust, Inc. includes in its taxable income, the income generated by investments in our CT CDOs. Due to the redirection provisions of our CT CDOs, which reallocate principal proceeds and interest otherwise distributable to us to repay senior noteholders, assets financed through our CT CDOs may generate current taxable income without a corresponding cash distribution to us. See Note 11 for further discussion of these redirection provisions. As of December 31, 2010, Capital Trust, Inc. had net operating losses, or NOLs, and net capital losses, or NCLs, available to be carried forward and utilized in current or future periods. These included NOLs of approximately $302.0 million and NCLs of approximately $129.0 million at Capital Trust, Inc., as well as NOLs of approximately $3.6 million at CTIMCO. As a result of our March 2011 restructuring, Capital Trust, Inc. will realize cancellation of indebtedness income of approximately $180.5 million for the 2011 taxable year which will reduce the available NOLs. The utilization of NOLs will also require us to pay alternative minimum taxes of approximately $2.0 million. Deferred income taxes recorded on our consolidated balance sheets reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities used for financial reporting purposes and the amounts used in the computation of our current income tax obligations. Our consolidated financial statements also include tax provisions related to taxable REIT subsidiaries of CT Legacy REIT. Although CT Legacy REIT is taxed separately from Capital Trust, Inc., its operations, including any income tax provisions, are consolidated for financial reporting purposes. The portion of our consolidated income tax provision related to CT Legacy REIT is immaterial for the nine months ended September 30, 2011.

Income Taxes

3 Months Ended

Sep. 30, 2011

Note 15. Income Taxes

Capital Trust, Inc. has made an election to be taxed as a REIT under Section 856(c) of the Internal Revenue Code, commencing with the tax year ending December 31, 2003. As a REIT, we generally are not subject to federal, state, and local income taxes except for the operations of our taxable REIT subsidiary, CTIMCO. To maintain qualification as a REIT, we must distribute at least 90% of our annual REIT taxable income to our shareholders and meet certain other requirements. If we fail to maintain our qualification as a REIT, we may be subject to material penalties as well as federal, state and local income tax on our taxable income at regular corporate rates. As of September 30, 2011 and December 31, 2010, Capital Trust, Inc. was in compliance with all REIT requirements.

In addition, Capital Trust, Inc. includes in its taxable income, the income generated by investments in our CT CDOs. Due to the redirection provisions of our CT CDOs, which reallocate principal proceeds and interest otherwise distributable to us to repay senior noteholders, assets financed through our CT CDOs may generate current taxable income without a corresponding cash distribution to us. See Note 11 for further discussion of these redirection provisions.

As of December 31, 2010, Capital Trust, Inc. had net operating losses, or NOLs, and net capital losses, or NCLs, available to be carried forward and utilized in current or future periods. These included NOLs of approximately $302.0 million and NCLs of approximately $129.0 million at Capital Trust, Inc., as well as NOLs of approximately $3.6 million at CTIMCO. As a result of our March 2011 restructuring, Capital Trust, Inc. will realize cancellation of indebtedness income of approximately $180.5 million for the 2011 taxable year which will reduce the available NOLs. The utilization of NOLs will also require us to pay alternative minimum taxes of approximately $2.0 million.

Deferred income taxes recorded on our consolidated balance sheets reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities used for financial reporting purposes and the amounts used in the computation of our current income tax obligations.

Our consolidated financial statements also include tax provisions related to taxable REIT subsidiaries of CT Legacy REIT. Although CT Legacy REIT is taxed separately from Capital Trust, Inc., its operations, including any income tax provisions, are consolidated for financial reporting purposes. The portion of our consolidated income tax provision related to CT Legacy REIT is immaterial for the nine months ended September 30, 2011.