Company: BHM
Filing Date: 2025-03-20
Form Type: 424B3
Source: 0001104659-25-026164
Chunk: 120

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-03-20
Form: 424B3
Chunk 120
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 2017-45 authorizing elective cash/stock dividends
to be made by “publicly offered REITs.” Pursuant to Revenue Procedure 2017-45, the IRS will treat the distribution of stock
pursuant to an elective cash/stock dividend as a distribution of property under Section 301 of the Code (i.e., a dividend), as long
as at least 20% of the total dividend is available in cash and certain other parameters detailed in the Revenue Procedure are satisfied.
On November 30, 2021, the IRS issued Revenue Procedure 2021-53, which temporarily reduced (through June 30, 2022) the minimum
amount of the distribution that must be available in cash to 10%.

If
we make any taxable dividend payable in cash and common stock, taxable stockholders receiving such dividend will be required to include
the full amount of the dividend as ordinary income to the extent of our current and accumulated earnings and profits, as determined for
U.S. federal income tax purposes. As a result, stockholders may be required to pay income tax with respect to such dividends in excess
of the cash dividends received. If a stockholder sells shares of our stock that it receives as a dividend in order to pay this tax, the
sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of the stock
at the time of the sale. Furthermore, with respect to certain non-U.S. holders, we may be required to withhold U.S. federal income tax
with respect to such dividends, including in respect of all or a portion of such dividend that is payable in our stock. If, in any taxable
dividend payable in cash and stock, a significant number of our stockholders determine to sell shares of our stock in order to pay taxes
owed on dividends, it may be viewed as economically equivalent to a dividend reduction and put downward pressure on the market price of
our common stock.

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Distributions payable by REITs do not qualify for the reduced tax rates that apply to other corporate distributions.

The
maximum U.S. federal income tax rate applicable to income from “qualified dividends” payable to U.S. stockholders that are
individuals, trusts and estates is currently 20%, plus a 3.8% “Medicare tax” surcharge. Dividends payable by REITs, however,
generally are not