NOTE 13 - TAXES

Income Tax

The Company has elected to be taxed as a Real Estate Investment Trust under the applicable provisions of the Internal Revenue Code under Sections 856 to 860 and the comparable New Jersey Statutes. Under such provisions, the Company will not be taxed on that portion of its taxable income distributed currently to shareholders, provided that at least 90% of its taxable income is distributed. As the Company has and intends to continue to distribute all of its income currently, no provision has been made for income taxes. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed taxable income. In addition, taxable income from non-REIT activities managed through taxable REIT subsidiaries is subject to federal, state, and local income taxes.

Federal Excise Tax

The Company does not have a Federal excise tax liability for the calendar years 2014, 2013 and 2012, since it intends to or has distributed all of its annual income.

Reconciliation Between U.S. GAAP Net Income and Taxable Income

The following table reconciles net income attributable to common shares to taxable income for the years ended September 30, 2014, 2013 and 2012:

		2014 Estimated (unaudited)		2013 Actual		2012 Actual
Net income (loss) applicable to common shareholders	$	11,238,262	$	12,788,214	$	13,171,369
Book / tax difference on gains / (losses) realized from capital transactions		(2,166,766)		(6,618,553)		(7,394,703)
Stock option expense		347,002		329,148		598,311
Deferred compensation		-0-		-0-		-0-
Other book / tax differences, net		(81,173)		(1,397,178)		(1,062,223)
Taxable income before adjustments		9,337,325		5,101,631		5,312,754
Add/(Less) capital gains (losses)		707,986		5,470,248		4,759,047
Estimated taxable income subject to 90% dividend requirement	$	10,045,311	$	10,571,879	$	10,071,801

Reconciliation Between Cash Dividends Paid and Dividends Paid Deduction

The following table reconciles cash dividends paid with the dividends paid deduction for the years ended September 30, 2014, 2013 and 2012:

		2014
		Estimated (unaudited)		2013 Actual		2012 Actual

Cash dividends paid	$	29,531,430	$	25,415,875	$	23,716,598
Less: Portion designated capital (gains) losses distribution		(707,986)		(5,470,248)		(4,759,047)
Less: Return of capital		(10,879,086)		(1,244,735)		(3,372,625)
Estimated dividends paid deduction	$	17,944,358	$	18,700,892	$	15,584,926