Federal and State Income Taxes

12 Months Ended

Dec. 31, 2011

Federal and State Income Taxes [Abstract]

Federal and State Income Taxes

15. Federal and State Income Taxes

The Trust has made no provision for regular current or deferred federal income taxes and no deferred state income taxes have been provided for on the basis that the Trust operates in a manner intended to enable it to continue to qualify as a real estate investment trust under Sections 856-860 of the Code. In order to qualify as a REIT, the Trust is generally required each year to distribute to its shareholders at least 90% of its taxable income (excluding any net capital gain). The Trust intends to comply with the foregoing minimum dividend requirements. As of December 31, 2011, the Trust has net operating loss carryforwards of approximately $932,000 which will expire in 2023. The Trust does expect to utilize approximately $23,108,000 of net operating loss carryforwards to offset 2011 taxable income. The Trust treats certain items of income and expense differently in determining net income reported for financial and tax purposes.

The Trust’s capital loss carryforwards of $45,508,000 are not available in certain states and localities where the Trust has an obligation to pay income taxes. In addition, certain states and localities disallow state income taxes as a deduction and exclude interest income from United States obligations when calculating taxable income. Federal and state tax calculations can differ due to differing recognition of net operating losses. Accordingly, the Trust has recorded, $379,000, $134,000 and $157,000 in state and local taxes for the years ended December 31, 2011, 2010 and 2009, respectively.

The 2011, 2010 and 2009 cash dividends per Series B-1 Preferred Share for an individual shareholder’s income tax purposes were as follows:

		September 30,		September 30,		September 30,		September 30,
	Ordinary Dividends		Capital Gains 15% Rate		Nontaxable Distribution		Total  Dividends Paid
2011	$	1.30	$	—	$	—	$	1.30
2010		2.03		—		—		1.22
2009		1.22		—		—		1.63

The 2011 and 2010 cash dividends per Series C Preferred Share for an individual shareholder’s income tax purposes were as follows:

		September 30,		September 30,		September 30,		September 30,
	Ordinary Dividends		Capital Gains 15% Rate		Nontaxable Distribution		Total  Dividends Paid
2011	$	1.30	$	—	$	—	$	1.30
2010		2.03		—		—		2.03

The 2011 cash dividends per Series D Preferred Share for an individual shareholder’s income tax purposes were as follows:

		September 30,		September 30,		September 30,		September 30,
	Ordinary Dividends		Capital Gains 15%  Rate		Nontaxable Distribution		Total  Dividends Paid
2011	$	0.21	$	—	$	—	$	0.21

The 2011, 2010 and 2009 cash dividends per Common Share for an individual shareholder’s income tax purposes were as follows:

		September 30,		September 30,		September 30,		September 30,
	Ordinary Dividends		Capital Gains 15% Rate		Nontaxable Distribution		Total  Dividends Paid
2011	$	0.65	$	—	$	—	$	0.65
2010		0.65		—		—		0.65
2009		0.65		—		0.10		0.75

The following table reconciles GAAP net income attributable to the Trust to taxable income (in thousands):

		September 30,			September 30,			September 30,
	For the Years Ended December 31,
	2011			2010			2009
Net income(loss) attributable to Winthrop Realty Trust	$	10,933		$	16,477		$	(84,347	)
Book/Tax differences from depreciation and amortization expense		4,588			189			1,512
Book/Tax differences of accretion of discount		(13,401	)		(8,782	)		(1,021	)
Book/Tax differences of unrealized gains		(2,788	)		(10,080	)		(18,530	)
Book/Tax differences on gains/losses from capital transactions		(5,842	)		1,655			1,532
Book/Tax differences on Preferred Shares		1,428			1,563			(4,386	)
Book/Tax differences for impairment losses		7,600			2,720			19,105
Book/Tax differences on investments in unconsolidated joint ventures		31,634			15,661			95,831
Other book/tax differences, net		(766	)		(134	)		607
Book/Tax differences on dividend income		(371	)		93			1,642
Book/Tax differences of market discount		13,250			—			—
Taxable income	$	46,265		$	19,362		$	11,945