Company: IIPR
Filing Date: 2025-02-21
Form Type: S-3ASR
Source: 0001104659-25-016184
Chunk: 82

Company: INNOVATIVE INDUSTRIAL PROPERTIES INC
Filing Date: 2025-02-21
Form: S-3ASR
Chunk 82
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 two holding period-related requirements. First, the U.S. stockholder must hold the REIT stock for a minimum
of 46 days during the 91-day period that begins 45 days before the date on which the REIT stock becomes ex-dividend with respect to the
dividend. Second, the qualifying portion of the REIT dividend is reduced to the extent that the U.S. stockholder is under an obligation
(whether pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related
property. Prospective investors should consult their tax advisors concerning the applicability of these rules and any limitations
on the ability to deduct all or a portion of dividends received on our securities.

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In addition, the 20% tax rate for qualified dividend
income will apply to our ordinary REIT dividends (i) attributable to dividends received by us from certain non-REIT corporations
(e.g., dividends from any domestic TRSs), (ii) to the extent attributable to income upon which we have paid corporate income tax
(e.g., to the extent that we distribute less than 100% of our taxable income) and (iii) attributable to income in the prior taxable
year from the sales of “built-in gain” property acquired by us from C corporations in carryover basis transactions (less
the amount of corporate tax on such income) with respect to such built-in gain. In general, to qualify for the reduced tax rate on qualified
dividend income, a U.S. holder must hold our shares for more than 60 days during the 121-day period beginning on the date that is 60
days before the date on which our shares of capital stock become ex-dividend.

Individuals, trusts and estates whose income
exceeds certain thresholds are also subject to a 3.8% Medicare tax on dividends received from us. The temporary 20% deduction currently
allowed with respect to ordinary REIT dividends received by non-corporate taxpayers, is allowed only for Chapter 1 of the Code and this
is not allowed as a deduction allocable to such dividends for purposes of determining the amount of net investment income subject to
the 3.8% Medicare tax, which is imposed under Chapter 2A of the Code. Dividends paid to a corporate U.S. stockholder will not qualify
for the dividends received deduction generally available to corporations.

A U.S. holder generally will take into account