Income Taxes Income Taxes

12 Months Ended

Dec. 31, 2013

INCOME TAXES

Beginning with our inception in 1991, we have elected to be taxed as a REIT under the Internal Revenue Code (the "Code"). We have elected that our subsidiary established on September 30, 2012 in connection with the Bickford arrangement (which holds our ownership interest in an operating company) be taxed as a taxable REIT subsidiary ("TRS") under provisions of the Code. The TRS is subject to federal and state income taxes like those applicable to regular corporations. Aside from such income taxes which may be applicable to the taxable income in the TRS, we will not be subject to federal income tax provided that we continue to qualify as a REIT and make distributions to stockholders equal to or in excess of our taxable income.

Per share dividend payments to common stockholders for the last three years are characterized for tax purposes as follows:



(Unaudited)	2013		2012		2011
Ordinary income	$	2.85895	$	2.62870	$	2.32042
Capital gain	0.16493		0.01130		0.32494
Return of capital	0.09612		—		0.06964
Dividends paid per common share	$	3.12	$	2.64	$	2.715

Our consolidated provision for state and federal income tax for the years ended 2013, 2012, and 2011 was $267,000, $137,000, and $96,000, respectively. For the years ended 2013, 2012, and 2011 we had no material deferred state or federal income tax.

Current taxes for 2013 of $128,000 relates to our equity interest in the unconsolidated operating company whose interest is owned by our TRS described above, plus $139,000 from a franchise tax levied by the state of Texas that has attributes of an income tax. For 2012, tax expense of $20,000 relates to our equity interest in the unconsolidated operating company and $117,000 relates to the Texas franchise tax. The tax expense for 2011 relates entirely to such tax levied in Texas. Our income taxes described above are combined in franchise, excise and other taxes in our Consolidated Statements of Income.

We made state income tax payments of $129,000, $96,000,and $82,000 for the years ended December 31, 2013, 2012 and 2011, respectively.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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