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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
INCOME TAXES  
INCOME TAXES

NOTE 14 — INCOME TAXES

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The Company elected to be taxed as a REIT under the Internal Revenue Code, commencing with its taxable year ended December 31, 1983. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it currently distribute at least 90% of its ordinary taxable income to its stockholders. As a REIT, the Company generally will not be subject to corporate level federal, state and local income tax on taxable income it distributes currently to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal, state and local income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT for four subsequent taxable years. It is management’s current intention to maintain the Company’s REIT status.

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Even though the Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed taxable income. As of December 31, 2024, tax returns for the calendar years 2021 through 2023 remain subject to examination by the Internal Revenue Service and various state and local tax jurisdictions. In November 2024, the Company collected a $238,000 refund from Tennessee related to franchise taxes paid during 2020 through 2022, as the state amended the method of calculating such taxes, resulting in overpayments made in such years. The refund is included in State Taxes on the consolidated statement of income for the year ended December 31, 2024.

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During 2024, 2023 and 2022, the Company did not incur any federal income tax expense. The Company does not have any deferred tax assets or liabilities at December 31, 2024 and 2023.

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The approximate allocation of the distributions made to stockholders is as follows for the years indicated:

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​

​

​

​

​

​

​

​

​

​

​

​

Year Ended December 31,

​

​

    

2024

    

2023

    

2022

Ordinary income (a)

​

55

%

​

53

%

​

54

%

Capital gains

​

45

​

​

47

​

​

46

​

​

​

100

%

​

100

%

​

100

%

(a)In 2024, 2023 and 2022, the ordinary income portion of the distributions are considered qualified REIT dividends and will be taxed at a rate reduced by up to 20% pursuant to Internal Revenue Code Section 199A.

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The Company treats depreciation expense, straight-line rent adjustments and certain other items differently for tax purposes than for financial reporting purposes. Therefore, its taxable income and dividends paid deduction differs from its financial statement income.

NOTE 14 — INCOME TAXES (CONTINUED)

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The following table reconciles dividends declared with the dividends paid deduction for the years indicated (amounts in thousands):

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​

​

​

​

​

​

​

​

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2024

    

2023

    

2022

​

​

Estimate

​

Actual

​

Actual

Dividends declared

​

$

38,421

​

$

38,116

​

$

37,915

Dividend reinvestment plan (a)

​

 

71

​

 

157

​

 

102

​

​

 

38,492

​

 

38,273

​

 

38,017

Less: Spillover dividends designated to previous year

​

 

(740)

​

 

(4,240)

​

 

—

Less: Spillover dividends designated to following year

​

​

(5,952)

​

​

—

​

​

—

Plus: Dividends designated from prior year

​

​

—

​

​

—

​

​

2,085

Plus: Dividends designated from following year

​

 

—

​

 

740

​

 

4,240

Dividends paid deduction

​

$

31,800

​

$

34,773

​

$

44,342

(a)Reflects the discount on common stock purchased through the dividend reinvestment plan of 3%.