Company: NXDT
Filing Date: 2025-01-21
Form Type: 424B3
Source: 0001437749-25-001494
Chunk: 135

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-21
Form: 424B3
Chunk 135
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 proceeds of disposition of the NXDT Common Shares exceeds (or is less than) the aggregate of the Resident Company Holder’s adjusted cost base of such NXDT Common Shares immediately before the disposition and any reasonable costs of disposition. The taxation of capital gains and capital losses is discussed below under “Taxation of Capital Gains and Capital Losses”.

Subject to the Capital Gains Proposals (as defined below), one half of any capital gain realized by a Resident Holder will be included in the Resident Holder's income as a taxable capital gain. Subject to the Capital Gains Proposals, one-half of any capital loss realized by a Resident Holder (an "allowable capital loss") generally may be deducted only from any taxable capital gains, if any, realized or considered to be realized by the Resident Holder subject to, and in accordance with, the provisions of the Tax Act. Any excess of allowable capital losses over taxable capital gains realized by a Resident Holder in a taxation year may be carried back to the three preceding taxation years or carried forward to any subsequent taxation years and deducted against net taxable capital gains in those years to the extent and under the circumstances described in the Tax Act.

Tax Proposals related to the capital gains inclusion rate (the "Capital Gains Proposals") would increase a Resident Holder's capital gains inclusion rate for a taxation year ending after June 24, 2024, from one-half to two-thirds, subject to a transitional rule applicable for a Resident Holder's 2024 taxation year that would reduce the capital gains inclusion rate for that taxation year to, in effect, be one-half for net capital gains realized before June 25, 2024. The Capital Gains Proposals also include provisions that would generally offset the increase in the capital gains inclusion rate for up to $250,000 of net capital gains realized (or deemed to be realized) by Resident Holders that are individuals (including certain trusts) in the year that are not offset by net capital losses carried back or forward from another taxation year. The Capital Gains Proposals also provide that capital losses realized prior to June 25, 2024, which are deductible against capital gains included in income for the 2024 or subsequent taxation years will offset an equivalent capital gain regardless of the inclusion rate which applied at the time such capital losses were realized. The foregoing summary only generally describes the considerations applicable under the Capital Gains Proposals and is not an exhaustive summary of the considerations that could arise in respect of the Capital Gains Proposals. The Capital Gains Proposals