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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

The following table summarizes the tax status of dividends paid on our common shares:


	Year ended December 31,
(in thousands)	2021		2020	2019
Dividend per share	$2.53	(1)	2.19	2.34
Ordinary income	92%		100%	97%
Capital gain (2)	8%		—%	3%

Additional tax status information:
Qualified dividend income	1%		—%	—%
Section 199A dividend	91%		100%	97%
Section 897 ordinary dividends	2%		—%	—%
Section 897 capital gains	4%		—%	—%

(1)

During 2021, the Company declared four quarterly dividends, the last of which was paid on January 5, 2022, with a portion allocated to the 2021 dividend period, and the balance allocated to 2022.

(2)

Of the total capital gain distribution during 2021, 42% is excluded under Reg. 1.1061-4(b)(7). The remaining 58% is a Three Year Amount under Reg. 1.1061-6(c).

Schedule of Components of Income Tax Expense (Benefit)

Our consolidated expense (benefit) for income taxes for the years ended December 31, 2021, 2020, and 2019 was as follows:


	Year ended December 31,
(in thousands)	2021	2020	2019
Income tax expense (benefit):
Current	$620	2,157	1,576
Deferred	421	(891)	(331)
Total income tax expense (benefit) (1)	$1,041	1,266	1,245

(1)

Includes $943,000, $(355,000) and $757,000 of tax expense (benefit) presented within Other operating expenses during the years ended December 31, 2021, 2020, and 2019, respectively. Additionally, $1.6 million, and $488,000 of tax expense is presented within Gain on sale of real estate (or Provision for impairment), net of tax, during the years ended December 31, 2020, and 2019, respectively.

Schedule of Effective Income Tax Rate Reconciliation

The TRS entities are subject to federal and state income taxes and file separate tax returns. Income tax expense (benefit) differed from the amounts computed by applying the U.S. Federal income tax rate to pretax income of the TRS entities, as follows:


	Year ended December 31,
(in thousands)	2021	2020	2019
Computed expected tax expense (benefit)	$544	(3,665)	1,587
State income tax, net of federal benefit	477	(593)	650
Valuation allowance	15	1,043	(91)
Permanent items	1	5,079	(819)
All other items	4	(598)	(82)
Total income tax expense (1)	1,041	1,266	1,245
Income tax expense attributable to operations (1)	$1,041	1,266	1,245

(1)

Includes $943,000, $(355,000), and $757,000 of tax expense (benefit) presented within Other operating expenses during the years ended December 31, 2021, 2020, and 2019, respectively. Additionally, $1.6 million, and $488,000 of tax expense is presented within Gain on sale of real estate (or Provision for impairment), net of tax, during the years ended December 31, 2020 and 2019, respectively.

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences (included in Accounts payable and other liabilities in the accompanying Consolidated Balance Sheets) are summarized as follows:


	December 31,
(in thousands)	2021			2020
Deferred tax assets
Provision for impairment	$	—			508
Fixed assets		1,039			1,077
Net operating loss carryforward		—			109
Other		1,379			771
Deferred tax assets		2,418			2,465
Valuation allowance		(2,418	)		(2,465	)
Deferred tax assets, net	$	—			—
Deferred tax liabilities
Straight line rent	$	—			(88	)
Fixed assets		(13,004	)		(12,943	)
Other		(340	)		—
Deferred tax liabilities		(13,344	)		(13,031	)
Net deferred tax liabilities	$	(13,344	)		(13,031	)