Saxon Capital, Inc. Announces Tax Treatment of 2005 Dividend Payments
January 25 2006 - 3:00PM
Business Wire
Saxon Capital, Inc. ("Saxon" or the "Company") (NYSE: SAX), a
residential mortgage lending and servicing real estate investment
trust (REIT), today announced the tax treatment of its 2005
dividend payments. Tax Treatment Four regular common stock
dividends and one special common stock dividend are reportable for
shareholders for the 2005 tax year. The following table provides
details for the common stock dividends that are taxable for 2005.
-0- *T Long Decla- Total Return Term Dividend ration Record Payable
Distri- Ordinary of Capital Type Dates Dates Dates buted Income
Capital Gains
----------------------------------------------------------------------
Regular April 19, April 29, May 11, 2005 2005 2005 $0.55 $0.55
$0.00 $0.00 Regular July 19, July 29, Aug.11, 2005 2005 2005 $0.55
$0.55 $0.00 $0.00 Regular Oct. 18, Oct. 28, Nov. 10, 2005 2005 2005
$0.50 $0.50 $0.00 $0.00 Regular Dec. 20, Dec. 30, Jan.11, 2005 2005
2006 $0.50 $0.50 $0.00 $0.00 Special Dec. 20, Dec. 30, Jan.11, 2005
2005 2006 $0.14 $0.14 $0.00 $0.00 --------------------------------
TOTAL $2.24 $2.24 $0.00 $0.00 *T Excess Inclusion Income For
shareholders that are tax-exempt or non-U.S corporations or
residents, you may be required to report a portion of Saxon's
dividend to the IRS as "Excess Inclusion Income." -- Tax-exempt
shareholders will be subject to unrelated business taxable income
(commonly referred to as UBTI) with respect to such excess
inclusion income; -- Non-U.S. shareholders will be subject to the
30 percent U.S. federal withholding tax on this income without
reduction under any otherwise applicable income tax treaty; and --
U.S. shareholders, including taxpaying entities, will not be able
to offset such excess inclusion income with net operating losses.
The Company expects that a portion of the 2005 dividend will
include Exclusion Income, and will announce this information when
it is available. Tax Disclaimer The sections entitled "Tax
Treatment" and "Excess Inclusion Income" above should not be
construed as tax advice and are not a substitute for careful tax
planning. You should consult your own tax advisor regarding the
specific federal, state, local, foreign and other tax consequences
to you regarding your ownership of shares of the Company's common
stock. About Saxon Saxon is a residential mortgage lender and
servicer that manages a portfolio of mortgage assets. Saxon
purchases, securitizes, and services real property secured
mortgages and elects to be treated as a real estate investment
trust (REIT) for federal tax purposes. The company is headquartered
in Glen Allen, Virginia and has additional primary facilities in
Fort Worth, Texas and Foothill Ranch, California. Saxon's
production subsidiary, Saxon Mortgage, Inc., originates and
purchases loans through indirect and direct lending channels
through a network of brokers, correspondents, and retail lending
centers. As of September 30, 2005, Saxon's servicing subsidiary,
Saxon Mortgage Services, Inc., serviced a mortgage loan portfolio
of $26.4 billion. For more information, visit
www.saxonmortgage.com. Information Regarding Forward Looking
Statements Statements in this news release other than statements of
historic fact, are "forward-looking statements" that are based on
current expectations and assumptions. These expectations and
assumptions are subject to risks and uncertainty, which could
affect Saxon's future plans. Saxon's actual results and the timing
and occurrence of expected events could differ materially from its
plans and expectations due to a number of factors, such as (i)
changes in overall economic conditions and interest rates, (ii)
Saxon's ability to successfully implement its growth strategy,
(iii) Saxon's ability to sustain loan origination growth at levels
sufficient to absorb costs of production and operational costs,
(iv) continued availability of credit facilities and access to the
securitization markets or other funding sources, (v) deterioration
in the credit quality of Saxon's loan portfolio, (vi) lack of
access to the capital markets for additional funding, (vii)
challenges in successfully expanding Saxon's servicing platform and
technological capabilities, (viii) Saxon's ability to remain in
compliance with federal tax requirements applicable to REITs, (ix)
Saxon's ability and the ability of its subsidiaries to operate
effectively within the limitations imposed on REITs by federal tax
rules, (x) changes in federal income tax laws and regulations
applicable to REITs, (xi) unfavorable changes in capital market
conditions, (xii) future litigation developments, (xiii)
competitive conditions applicable to Saxon's industry, and (xiv)
changes in the applicable legal and regulatory environment. You
should also be aware that all information in this news release is
as of January 25, 2006. Saxon undertakes no duty to update any
forward-looking statement to conform the statement to actual
results or changes in the company's expectations.
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