Company: RWT-PA
Filing Date: 2025-01-16
Form Type: 424B5
Source: 0001104659-25-004099
Chunk: 86

Company: REDWOOD TRUST INC
Filing Date: 2025-01-16
Form: 424B5
Chunk 86
---
 material aspects of the sections of the Code that govern the U.S. federal income
tax treatment of a REIT and its stockholders. This summary is qualified in its entirety by the applicable Code provisions, Treasury Regulations
promulgated under the Code, and administrative and judicial interpretations thereof. Potential tax reforms may result in significant
changes to the rules governing U.S. federal income taxation. New legislation, Treasury Regulations, administrative interpretations
and practices and/or court decisions may significantly and adversely affect our ability to qualify as a REIT, the U.S. federal income
tax consequences of such qualification, or the U.S. federal income tax consequences of an investment in us, including those described
in this discussion. Moreover, the law relating to the tax treatment of other entities, or an investment in other entities, could change,
making an investment in such other entities more attractive relative to an investment in a REIT. Any such changes could apply retroactively
to transactions preceding the date of the change. We have not requested, and do not plan to request, any rulings from the IRS that we
qualify as a REIT, and the statements in this prospectus are not binding on the IRS or any court. Thus, we can provide no assurance that
the tax considerations contained in this discussion will not be challenged by the IRS or will be sustained by a court if challenged by
the IRS. This summary does not discuss any state, local or non-U.S. tax consequences, or any tax consequences arising under any U.S.
federal tax laws other than U.S. federal income tax laws, associated with the purchase, ownership or disposition of our capital stock
or debt securities, or our election to be taxed as a REIT.

You are urged to consult your tax advisor regarding the tax consequences to you of:

| · | the purchase,                                                                                                                       
 ownership and disposition of our capital stock or debt securities, including the U.S. federal, state, local, non-U.S. and other tax 
 consequences;                                                                                                                       |

| · | our election to be taxed as a                  
 REIT for U.S. federal income tax purposes; and |

| · | potential changes in applicable 
 tax laws.                       |

<div align='center'>26</div>

Taxation of the Company

General

We have elected to be taxed
as a REIT under Sections 856 through 860 of the Code commencing with our taxable year ended December 31, 1994. We believe that we
have been organized and have operated