Company: TWO-PC
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001465740-25-000152
Chunk: 65

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-10-28
Form: 10-Q
Item: Item 1
Chunk 65
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Revolving credit facilities19,142 26,873 59,611 87,026 Warehouse lines of credit111 11 295 11 Term notes payable— — — 12,426 Senior notes2,884 — 4,380 — Convertible senior notes4,517 4,495 13,417 13,693 Other575 — 575 — Total interest expense117,120 154,931 385,535 469,138 Net interest expense$(23,505)$(42,289)$(63,456)$(122,760)

Note 18. Income Taxes

For the nine months ended September 30, 2025 and 2024, the Company qualified to be taxed as a REIT under the Internal Revenue Code for U.S. federal income tax purposes. As long as the Company qualifies as a REIT, the Company generally will not be subject to U.S. federal income taxes on its taxable income to the extent it annually distributes its net taxable income to stockholders, and does not engage in prohibited transactions. The Company intends to distribute 100% of its REIT taxable income and comply with all requirements to continue to qualify as a REIT. The majority of states also recognize the Company’s REIT status. The Company’s TRSs file separate tax returns and are fully taxed as standalone U.S. C corporations. It is assumed that the Company will retain its REIT status and will incur no REIT level taxation as it intends to comply with the REIT regulations and annual distribution requirements.On July 4, 2025, the President signed into law the One Big Beautiful Bill Act, or the OBBBA, which includes a broad range of tax reform provisions affecting businesses. The OBBBA extends or makes permanent certain tax law changes enacted as part of the 2017 Tax Cuts and Jobs Act, as well as makes other changes to the current tax code. The effects of the OBBBA have not had a material impact on the Company’s financial condition, results of operations or financial statement disclosures, nor are they expected to have a material impact on future periods.During the three and nine months ended September 30, 2025, the Company recognized a provision for income taxes of $1.2 million and $3.3 million, respectively, which was primarily due to net income from MSR servicing and mortgage loan origination activities, partially offset by net losses recognized on MSR and operating expenses incurred