Company: PRIF-PJ
Filing Date: 2025-03-26
Form Type: N-2
Source: 0001554625-25-000027
Chunk: 179

Company: Priority Income Fund, Inc.
Filing Date: 2025-03-26
Form: N-2
Chunk 179
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 the dividend was declared.

If an investor purchases shares of Series M Term Preferred Stock shortly before the record date of a distribution, the price of the shares will include the value of the distribution and the investor will be subject to tax on the distribution even though economically it may represent a return of his, her or its investment.

A U.S. preferred stockholder generally will recognize taxable gain or loss if the stockholder sells or otherwise disposes of his, her or its shares of Series M Term Preferred Stock. The amount of gain or loss will be measured by the difference between such stockholder’s adjusted tax basis in the shares sold and the amount of the proceeds received in exchange. Any gain arising from such sale or disposition generally will be treated as long-term capital gain or loss if the stockholder has held his, her or its shares of Series M Term Preferred Stock for more than one year. Otherwise, it will be classified as short-term capital gain or loss. However, any capital loss arising from the sale or disposition of shares of Series M Term Preferred Stock held for six months or less will be treated as long-term capital loss to the extent of the amount of capital gain dividends received with respect to such shares. In addition, all or a portion of any loss recognized upon a disposition of shares of Series M Term Preferred Stock may be disallowed if other shares of Series M Term Preferred Stock are purchased (whether through reinvestment of distributions or otherwise) within 30 days before or after the disposition.

Gain or loss, if any, resulting from our redemption of shares of Series M Term Preferred Stock will generally be taxed as gain or loss from a sale or exchange of the Series M Term Preferred Stock rather than as a dividend, but only if the redemption distribution (a) is deemed not to be essentially equivalent to a dividend, (b) is in complete redemption of a holder of Series M Term Preferred Stock’s interest in us, (c) is substantially disproportionate with respect to the holder, or (d) with respect to noncorporate holders, is in partial liquidation of us. For purposes of (a), (b) and (c) above, if a holder holds both Series M Term Preferred Stock and our common stock, such holder’s ownership of our common stock will be taken into account.

A portion of the amount received by a holder of Series M Term Preferred Stock on either the sale, or redemption, of the Series M Term Preferred Stock may be characterized as dividend income to the extent it is attributable to declared but unpaid dividends.

Adjusted tax basis