What are Non-Traded Real Estate Investment Trusts (REITs)? (2024)

ENDNOTES
1. Suitability standards may vary by state, but generally require an investor to have: 1) a net worth of at least $250,000; or 2) a gross annual income of at least $70,000 and a net worth of at least $70,000.
2. A REIT is able to pass through taxes for capital gains, dividends, or interest earned to individual investors avoiding double taxation (at both the fund and investor level).
3. Tax Cuts and Jobs Act, Provision 11011 Section 199A – Qualified Business Income Deduction FAQs, as of Sept. 6, 2023.
4. For specific requirements, please see Internal Revenue Code Section 856.
5. A company will be disqualified as a REIT if, after the first taxable year, more than 50% of its shares is owned directly or indirectly by five or fewer individuals. For specific requirements, please see Internal Revenue Code Section 856(h).
6. For specific requirements, please see Internal Revenue Code Section 856(c).
7. The Board can decide to suspend share repurchases at any time. Redemption programs also may require that shares be redeemed at a discount, meaning investors lose part of their investment if they redeem their shares.

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