ARLINGTON, Va., June 17, 2015 /PRNewswire/ -- Arlington Asset Investment Corp. (NYSE: AI) (the "Company") today announced that it is revising the tax characterization of its distributions to shareholders for calendar year 2014 to be nontaxable returns of capital. The Company had previously reported on Form 1099-DIV that all of its 2014 distributions to shareholders were qualified dividends eligible for reduced capital gains rates.
Under applicable tax law and regulations for C-corporations, distributions to shareholders in excess of current or accumulated earnings and profits should be reported as returns of capital instead of qualified dividends. Distributions that are classified as returns of capital are nontaxable to the extent they do not exceed a shareholder's adjusted tax basis in the Company's stock, or as a capital gain to the extent that the amount of the distribution exceeds a shareholder's adjusted tax basis in the Company's stock. In preparing its federal income tax returns for 2014, the Company has now determined that it did not have current or accumulated earnings and profits for the year ended December 31, 2014, and therefore all of the Company's distributions to shareholders in 2014 should have been reported as returns of capital instead of qualified dividends. The Company recommends that shareholders consult with their tax advisor to determine their specific reduction in tax liability from this change.
The Company has instructed its transfer agent to issue an amended Form 1099-DIV to registered holders of its common stock for the 2014 year. For shareholders whose shares are held through a brokerage firm or other nominee, the brokerage firm or nominee is responsible for issuing an amended Form 1099-DIV for the 2014 year, and such shareholders should contact their brokerage firm directly regarding obtaining an amended Form 1099-DIV.
About the Company
Arlington Asset Investment Corp. (NYSE: AI) is a principal investment firm that currently invests primarily in mortgage-related and other assets. The Company is headquartered in the Washington, D.C. metropolitan area. For more information, please visit www.arlingtonasset.com.
SOURCE Arlington Asset Investment Corp.