INCOME TAXES

6 Months Ended

Jun. 30, 2011

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

10. INCOME TAXES

Presidential has elected to qualify as a Real Estate Investment Trust under the Internal Revenue Code. A REIT which distributes at least 90% of its real estate investment trust taxable income to its shareholders each year by the end of the following year and which meets certain other conditions will not be taxed on that portion of its taxable income which is distributed to its shareholders.

The Company follows the guidance of ASC 740 which prescribes a more likely than not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken. If the Company’s tax position in relation to a transaction was not likely to be upheld, the Company would be required to record the accrual for the tax and interest thereon. As of December 31, 2010, the tax years that remain open to examination by the federal, state and local taxing authorities are the 2007 – 2009 tax years and the Company was not required to accrue any liability for those tax years.

For the year ended December 31, 2010, the Company had a tax loss of approximately $3,895,000 ($1.14 per share), which is comprised of an ordinary loss of approximately $6,002,000 ($1.76 per share) and capital gains of approximately $2,107,000 ($0.62 per share).

As previously stated, in order to maintain REIT status, Presidential is required to distribute 90% of its REIT taxable income (exclusive of capital gains). As a result of the ordinary tax loss of $1.76 per share for 2010, the Company will not be required to make a distribution in 2011 for the 2010 year in order to maintain its qualification as a REIT.

For the six months ended June 30, 2011, the Company had a tax loss of approximately $5,224,000 ($1.53 per share), which is comprised of an ordinary loss of approximately $4,881,000 ($1.43 per share) and a capital loss of approximately $343,000 ($0.10 per share).