Company: BHM
Filing Date: 2025-11-18
Form Type: S-11/A
Source: 0001104659-25-113674
Chunk: 112

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-11-18
Form: S-11/A
Chunk 112
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 of the related debt or property is extinguished
or disposed of, and that are clearly and timely identified as such will be excluded from both the numerator and the denominator for purposes
of the gross income tests that apply to REITs. Moreover, any income from a transaction entered into primarily to manage risk of currency
fluctuations with respect to any item of income that would be qualifying REIT income under the REIT gross income tests, and any gain
from the unwinding of any such transaction, does not constitute gross income for purposes of the REIT gross income tests. To the extent
that we do not properly identify such transactions as hedges or we hedge with other types of financial instruments, or hedge other types
of indebtedness, the income from those transactions may not be treated as qualifying income for purposes of the REIT gross income tests,
and might also give rise to an asset that does not qualify for purposes of the REIT asset tests.

Our ability to provide certain services to our tenants may be limited by the REIT rules or may have to be provided through a TRS.

As a REIT, we generally will
not be able provide services to our tenants other than those that are customarily provided by landlords, nor will we be able to derive
income from a third party that provides such services. If we forego providing such services to our tenants, we may be at a disadvantage
to competitors that are not subject to the same restrictions. However, we can provide such non-customary services to tenants and share
in the revenue from such services if we do so through a TRS, though income earned by such TRS will be subject to U.S. federal corporate
income tax.

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Any ownership of a TRS will
be subject to limitations, and our transactions with a TRS will cause us to be subject to a 100% penalty tax on certain income or deductions
if those transactions are not conducted on arm’s-length terms.

Overall, no more than 20%
(25% for 2026 and future tax years) of the value of a REIT’s assets may consist of stock or securities of one or more TRSs. A TRS
will be subject to applicable U.S. federal, state and local corporate income tax on its taxable income, and its after-tax net income
will be available for distribution to us but is not required to be distributed to us. In addition, the Code limits the deductibility
of interest paid