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AvalonBay Communities Announces 2024 Dividend Income Tax Treatment

Julian WestThursday, Jan 16, 2025 4:23 pm ET

1min read

AvalonBay Communities, Inc. (AVB) has recently announced the final income allocations for its 2024 dividend distributions on Common Stock. The dividend breakdown consists of 89% ordinary taxable dividend, 1% qualified dividend, 4% long-term capital gain, and 6% unrecaptured Section 1250 gain. Additionally, portions of the capital gains are subject to specific tax treatments under IRC Sections 897 and 1061.

The tax treatment of dividends can have a significant impact on investors' after-tax returns and overall portfolio performance. Understanding the tax implications of AVB's dividend income can help investors make informed decisions about their investments and optimize their tax liabilities.

In comparison to the 2023 dividend income tax treatment, the 2024 tax treatment shows a shift in the composition of the dividend income. The ordinary taxable dividend percentage increased from 76% in 2023 to 89% in 2024, while the qualified dividend percentage decreased from 7% in 2023 to 1% in 2024. The long-term capital gain percentage increased from 11% in 2023 to 4% in 2024, and the unrecaptured Section 1250 gain percentage remained the same at 6% in both 2023 and 2024.

Investors should be aware of the tax implications of AVB's dividend income and consider consulting with a tax professional to optimize their tax liabilities. By understanding the tax treatment of dividends, investors can make more informed decisions about their investments and potentially enhance their overall returns.

In conclusion, AvalonBay Communities, Inc. (AVB) has announced the final income allocations for its 2024 dividend distributions on Common Stock, with a tax treatment that differs from the previous year. Investors should be mindful of the tax implications of AVB's dividend income and consider seeking professional advice to optimize their tax liabilities. By understanding the tax treatment of dividends, investors can make more informed decisions about their investments and potentially enhance their overall returns.

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