Sachem Capital Corp. Announces Tax Reporting Information

Rhea-AI Summary

Sachem Capital Corp. (NYSE American: SACH) has released its tax treatment information for 2024 distributions on common and preferred stock. For common stock, the company paid total distributions of $0.24 per share, distributed across three payments: $0.11 (April), $0.08 (August), and $0.05 (November). All common stock distributions were classified as nondividend distributions.

For preferred stock, SACH distributed a total of $1.9375 per share through four quarterly payments of $0.484375 each, all classified as nondividend distributions. The company operates as a mortgage REIT, specializing in short-term secured loans for real estate investors, focusing on properties held for resale or investment with first mortgage liens.

Positive

• Maintained consistent quarterly preferred stock dividend payments throughout 2024
• Continued dividend payments on common stock, indicating operational stability

Negative

• Common stock dividend decreased throughout 2024 from $0.11 to $0.05 per share
• Total common stock distribution of $0.24 per share indicates reduced shareholder returns

Insights

Tax and REIT Specialist

The 2024 tax treatment disclosure from Sachem Capital Corp reveals several important insights for investors. The common stock distributions show a concerning downward trend, declining from $0.11 to $0.08 and finally to $0.05 per share throughout the year, potentially indicating cash flow pressures.

The classification of all distributions as nondividend distributions (return of capital) is particularly noteworthy. This means shareholders must reduce their cost basis by $0.24 per share for common stock and $1.9375 for preferred stock, rather than treating the payments as ordinary income. This tax treatment suggests the REIT's distributions exceeded its earnings and profits for 2024, which is unusual for a mortgage REIT that typically generates sufficient taxable income to classify distributions as ordinary dividends.

The preferred stock maintained stable quarterly payments of $0.484375, demonstrating the senior security's resilience compared to the declining common stock distributions. However, the return of capital treatment for both securities may signal underlying profitability challenges that investors should monitor closely, as sustained returns of capital can eventually erode investment basis and potentially impact future distribution sustainability.

BRANFORD, Conn., Jan. 27, 2025 (GLOBE NEWSWIRE) -- Sachem Capital Corp. (NYSE American: SACH) announced today the tax treatment for the Company's distributions on its common stock (CUSIP: 78590A109) and preferred stock (CUSIP: 78590A505) paid with respect to the calendar year ended December 31, 2024:

COMMON STOCK TAX INFORMATION

			Box 1a	Box 1b	Box 2a	Box 3	Box 5
Record Date	Payable Date	Rate per Share	Ordinary Dividends Per Share	Qualified Dividends Per Share	Total Capital Gain Per Share	Nondividend Dist. Per Share	Section 199A Dividends Per Share
04/09/2024	04/16/2024	$0.110000	$0.000000	$0.000000	$0.000000	$0.110000	$0.000000
07/29/2024	08/06/2024	$0.080000	$0.000000	$0.000000	$0.000000	$0.080000	$0.000000
11/18/2024	11/26/2024	$0.050000	$0.000000	$0.000000	$0.000000	$0.050000	$0.000000
	Total	$0.240000	$0.000000	$0.000000	$0.000000	$0.240000	$0.000000

PREFERRED STOCK TAX INFORMATION

			Box 1a	Box 1b	Box 2a	Box 3	Box 5
Record Date	Payable Date	Rate per Share	Ordinary Dividends Per Share	Qualified Dividends Per Share	Total Capital Gain Per Share	Nondividend Dist. Per Share	Section 199A Dividends Per Share
03/15/2024	03/30/2024	$0.484375	$0.000000	$0.000000	$0.000000	$0.484375	$0.000000
06/15/2024	06/30/2024	$0.484375	$0.000000	$0.000000	$0.000000	$0.484375	$0.000000
09/15/2024	09/30/2024	$0.484375	$0.000000	$0.000000	$0.000000	$0.484375	$0.000000
12/15/2024	12/30/2024	$0.484375	$0.000000	$0.000000	$0.000000	$0.484375	$0.000000
	Total	$1.937500	$0.000000	$0.000000	$0.000000	$1.937500	$0.000000

About Sachem Capital Corp.
Sachem Capital Corp. is a mortgage REIT that specializes in originating, underwriting, funding, servicing, and managing a portfolio of loans secured by first mortgages on real property. It offers short-term (i.e., three years or less) secured, nonbanking loans to real estate investors to fund their acquisition, renovation, development, rehabilitation, or improvement of properties. The Company’s primary underwriting criteria is a conservative loan to value ratio. The properties securing the loans are generally classified as residential or commercial real estate and, typically, are held for resale or investment. Each loan is secured by a first mortgage lien on real estate and is personally guaranteed by the principal(s) of the borrower. The Company also makes opportunistic real estate purchases apart from its lending activities.

FAQ

What was SACH's total dividend distribution for common stock in 2024?

SACH's total dividend distribution for common stock in 2024 was $0.24 per share.

How much did Sachem Capital (SACH) pay in preferred stock dividends for 2024?

SACH paid $1.9375 per share in preferred stock dividends for 2024, distributed as four quarterly payments of $0.484375.

What was the tax treatment of SACH's 2024 distributions?

All distributions for both common and preferred stock were classified as nondividend distributions, with no ordinary dividends, qualified dividends, or capital gains.

How did SACH's common stock dividend payments change throughout 2024?

SACH's common stock dividend payments decreased throughout 2024, starting at $0.11 in April, reducing to $0.08 in August, and further decreasing to $0.05 in November.