Company: RWT-PA
Filing Date: 2025-01-15
Form Type: 424B5
Source: 0001104659-25-003632
Chunk: 115

Company: REDWOOD TRUST INC
Filing Date: 2025-01-15
Form: 424B5
Chunk 115
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 (within the meaning of Section 7701(a)(30) of the Code) or (2) has a valid election in effect to be treated as a United 
 States person for U.S. federal income tax purposes.                                                                     |

For purposes of this discussion,
a “Non-U.S. Holder” is any beneficial owner of our capital stock or debt securities that is neither a U.S. Holder nor an
entity treated as a partnership for U.S. federal income tax purposes.

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If an entity treated as a
partnership for U.S. federal income tax purposes holds our capital stock or debt securities, the tax treatment of a partner in the partnership
will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Accordingly,
partnerships holding our capital stock or debt securities and the partners in such partnerships should consult their tax advisors regarding
the U.S. federal income tax consequences to them.

Taxation of Taxable U.S. Holders of Our Capital Stock

Distributions Generally

Distributions out of our
current or accumulated earnings and profits will be treated as dividends and, other than with respect to capital gain dividends and certain
amounts which have previously been subject to corporate level tax, as discussed below, will be taxable to our taxable U.S. Holders as
ordinary income when actually or constructively received. See “Material U.S. Federal Income Tax Considerations—Federal Income
Tax Considerations for Holders of Our Capital Stock and Debt Securities—Taxation of Taxable U.S. Holders of Our Capital Stock—Tax
Rates” below. As long as we qualify as a REIT, these distributions will not be eligible for the dividends-received deduction in
the case of U.S. Holders that are corporations or, except to the extent described in “Material U.S. Federal Income Tax Considerations—Federal
Income Tax Considerations for Holders of Our Capital Stock and Debt Securities—Taxation of Taxable U.S. Holders of Our Capital
Stock—Tax Rates” below, the preferential rates on qualified dividend income applicable to non-corporate U.S. Holders, including
individuals. For purposes of determining whether distributions to holders of our capital stock are out of our current or accumulated
earnings and profits, our earnings and profits will be allocated first to our outstanding preferred stock, if any, and then to our outstanding
common stock.

To the extent that we make