XML 43 R26.htm IDEA: XBRL DOCUMENT v3.25.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes
16.
Income Taxes

The Company elected to be treated as a REIT under the Code, commencing with its taxable year ended December 31, 1993. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that the Company distribute at least 90% of its taxable income (excluding net capital gains) to its shareholders. It is management’s current intention to adhere to these requirements and maintain the Company’s REIT status. As a REIT, the Company generally will not be subject to corporate level federal income tax on taxable income it distributes to its shareholders. As the Company distributed sufficient taxable income for each of the three years ended December 31, 2024, 2023 and 2022, no U.S. federal income or excise taxes were incurred.

If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates and may not be able to qualify as a REIT for the four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain foreign, state and local taxes on its income and property and to federal income and excise taxes on its undistributed taxable income. In addition, the Company has historically utilized a TRS that is subject to federal, state and local income taxes on any taxable income generated from its operational activity.

In order to maintain its REIT status, the Company must meet certain income tests to ensure that its gross income consists of passive income and not income from the active conduct of a trade or business. The Company historically utilized a TRS to the extent certain fee and other miscellaneous non-real estate-related income could not be earned by the REIT. In January 2025, the Company eliminated its TRS.

For the years ended December 31, 2024, 2023 and 2022, the Company made net state and local tax payments of $1.0 million and $1.8 million and $0.6 million, respectively.

The following represents the activity of the Company’s TRS (in thousands):

 

 

For the Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

Book income (loss) before income taxes

 

$

19,644

 

 

$

6,450

 

 

$

6,374

 

Current

 

$

—

 

 

$

—

 

 

$

—

 

Deferred

 

 

—

 

 

 

—

 

 

 

—

 

Total income tax expense

 

$

—

 

 

$

—

 

 

$

—

 

The differences between total income tax expense and the amount computed by applying the statutory income tax rate to income before taxes with respect to its TRS activity were as follows (in thousands):

 

 

For the Year Ended December 31,

 

TRS

 

2024

 

 

2023

 

 

2022

 

Statutory Rate

 

 

21

%

 

 

21

%

 

 

21

%

Statutory rate applied to pre-tax income (loss)

 

$

4,125

 

 

$

1,355

 

 

$

1,339

 

Deferred tax impact of contributions of assets

 

 

—

 

 

 

—

 

 

 

(7,542

)

Deferred tax impact of tax rate change

 

 

80

 

 

 

339

 

 

 

261

 

Valuation allowance (decrease) increase based on impact
   of tax rate change

 

 

(80

)

 

 

(339

)

 

 

(261

)

Valuation allowance (decrease) increase – other deferred

 

 

(5,416

)

 

 

(1,337

)

 

 

6,094

 

Expiration of capital loss carryforward

 

 

—

 

 

 

—

 

 

 

—

 

Other

 

 

1,291

 

 

 

(18

)

 

$

109

 

Total expense

 

$

—

 

 

$

—

 

 

$

—

 

Effective tax rate

 

 

0.00

%

 

 

0.00

%

 

 

0.00

%

 

 

 

 

 

 

 

 

 

 

 

 

Deferred tax assets and liabilities of the Company’s TRS were as follows (in thousands):

 

For the Year Ended December 31,

 

 

2024

 

 

2023

 

Deferred tax assets(A)

$

29,801

 

 

$

36,056

 

Deferred tax liabilities

 

-

 

 

 

(139

)

Valuation allowance

 

(29,801

)

 

 

(35,917

)

Net deferred tax asset

$

—

 

 

$

—

 
(A)
At December 31, 2024, primarily attributable to $18.3 million of net operating losses and $10.5 million of book/tax differences in joint venture investments. At December 31, 2023, primarily attributable to $20.5 million of net operating losses, $9.8 million of book/tax differences in joint venture investments. The TRS net operating loss carryforwards will expire in varying amounts between the years 2025 and 2036, except for approximately $6.8 million in both 2024 and 2023 that does not expire and is limited to 80% of taxable income.

Reconciliation of GAAP net income attributable to SITE Centers to taxable income is as follows (in thousands):

 

For the Year Ended December 31,

 

 

2024

 

 

2023

 

 

2022

 

GAAP net income attributable to SITE Centers

$

531,824

 

 

$

265,703

 

 

$

168,719

 

Book/tax differences

 

175,622

 

 

 

(57,471

)

 

 

(60,732

)

Taxable income before adjustments

 

707,446

 

 

 

208,232

 

 

 

107,987

 

Less: Net operating loss carryforward

 

—

 

 

 

(54,466

)

 

 

—

 

Less: Capital gains

 

—

 

 

 

—

 

 

 

(7,664

)

Taxable income subject to the 90% dividend requirement

$

707,446

 

 

$

153,766

 

 

$

100,323

 

Cash dividends declared applicable to tax years ended December 31, 2024, 2023 and 2022, were in excess of taxable income. The Company satisfied it REIT distribution requirement by distributing $46.14, $2.72 and $2.04 per share of common stock and $1.38, $1.59 and $1.59 per depository share of preferred stock for the years ended December 31, 2024, 2023 and 2022, respectively. The common stock distributions for the year ended December 31, 2024 were comprised of regular cash distributions of $0.52 per share of common stock for three quarters and a stock distribution of $44.58. The common stock distributions for the year ended December 31, 2023 were comprised of regular quarterly cash distributions of $0.52 per share of common stock and a special cash distribution of $0.64 per share of common stock. The common stock distributions for the year ended December 31, 2022 were comprised of three quarterly cash distributions of $0.52 per share of common stock and one quarterly cash distribution of $0.48 per share of common stock. The taxability of such distribution for the year ended December 31, 2024 is as follows:

 

 

For the Year Ended December 31,

 

Common Shares

 

2024

 

 

2023

 

 

2022

 

Distributions paid per share

 

$

46.14

 

 

$

2.72

 

 

$

2.04

 

Ordinary income

 

—%

 

 

29%

 

 

83%

 

Return of capital

 

71%

 

 

—%

 

 

11%

 

Capital gains

 

29%

 

 

71%

 

 

6%

 

 

 

 

 

 

 

 

 

 

 

Preferred Shares

 

 

 

 

 

 

 

 

 

Distributions paid per share

 

$

1.38

 

 

$

1.59

 

 

$

1.59

 

Ordinary income

 

—%

 

 

29%

 

 

93%

 

Return of capital

 

—%

 

 

—%

 

 

—%

 

Capital gains

 

100%

 

 

71%

 

 

7%