Company: EPR-PE
Filing Date: 2025-06-03
Form Type: S-3ASR
Source: 0001193125-25-134116
Chunk: 76

Company: EPR PROPERTIES
Filing Date: 2025-06-03
Form: S-3ASR
Chunk 76
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ated under the alternative depreciation system
under the Code, which is generally less favorable than the generally applicable system of depreciation under the Code. If we do not make the election or if the election is determined not to be available with respect to all or certain of our business
activities, this interest deduction limitation could result in us having more REIT taxable income and thus increase the amount of distributions we must make to comply with the REIT requirements and avoid incurring corporate-level tax. Similarly, the
limitation could cause our TRSs to have greater taxable income and thus potentially greater corporate tax liability.

Failure to Qualify

Certain cure provisions may be available to us in the event that we discover a violation of a provision of the Code that
would result in our failure to qualify as a REIT. Except with respect to violations of the gross income tests and assets tests (for which the cure provisions are described above), and provided the violation is due to reasonable cause and not due to
willful neglect, these cure provisions generally impose a $50,000 penalty for each violation in lieu of a loss of REIT status. If we fail to qualify for taxation as a REIT in any taxable year, and the relief provisions do not apply, we will be
subject to tax on our taxable income at regular corporate rates.

51

Distributions to shareholders in any year in which we fail to qualify will not be deductible by us, and we will not be required to distribute any amounts to our shareholders. As a result, our failure to qualify as a REIT would reduce the cash available for distribution by us to our shareholders. It is not possible to state whether in all circumstances we would be entitled to this statutory relief. In addition, if we fail to qualify as a REIT, all distributions to shareholders would be taxable as regular corporate dividends to the extent of our current and accumulated earnings and profits. In this event, subject to certain limitations under the Code, corporate distributees may be eligible for the dividends-received deduction and individual distributees may be eligible for preferential rates, if any, on any qualified dividend income. However, if we fail to qualify as a REIT, for taxable years beginning after December 31, 2017 and before January 1, 2026, U.S. shareholders that are individuals, trusts and estates would no longer be entitled to the 20% deduction for ordinary dividends distributed by us, subject to certain limitations. Unless entitled to relief under specific statutory provisions, we also would be disqualified from taxation as