Company: NXDT
Filing Date: 2025-04-25
Form Type: 424B3
Source: 0001437749-25-013177
Chunk: 178

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-04-25
Form: 424B3
Chunk 178
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 made whether the distribution will be in excess of current and accumulated earnings and profits, withholding will apply to the distribution at the rate applicable to dividends. However, the non-U.S. stockholder may seek a refund of these amounts from the IRS if it is subsequently determined that the distribution was, in fact, in excess of New NXDT’s current and accumulated earnings and profits.

Also, New NXDT (or applicable withholding agent) could potentially be required to withhold at least 15% of any distribution in excess of New NXDT’s current and accumulated earnings and profits, even if the non-U.S. stockholder is not liable for U.S. tax on the receipt of that distribution. However, a non-U.S. stockholder may seek a refund of these amounts from the IRS if the non-U.S. stockholder’s tax liability with respect to the distribution is less than the amount withheld. Such withholding generally should not be required if a non-U.S. stockholder would not be taxed under the Foreign Investment in Real Property Tax Act of 1980, as amended (“FIRPTA”), upon a sale or exchange of shares of New Stock. See discussion below under “-Sales of Shares of New Stock”.

Capital Gain Dividends; Distributions Attributable to Sale or Exchange of Real Property. Except as described below, distributions to a non-U.S. stockholder that New NXDT properly designates as capital gain dividends, other than those arising from the disposition of a U.S. real property interest, generally should not be subject to U.S. federal income taxation, unless (1) the investment in New NXDT shares is treated as effectively connected with a non-U.S. stockholder’s U.S. trade or business, in which case such non-U.S. stockholder will be subject to the same treatment as U.S. stockholders with respect to such gain, except that a non-U.S. stockholder that is a foreign corporation may also be subject to the 30% branch profits tax, as discussed above; or (2) such non-U.S. stockholder is a nonresident alien individual who is present in the United States for 183 days or more during the taxable year and certain other conditions are met, in which case such non-U.S. stockholder will be subject to a 30% tax on its capital gains.

Distributions that are attributable to gain from sales or exchanges of “U.S. real property interests” are taxable to a non-U.S. stockholder under FIRPTA. The