Tax Treatment

Taxation of United States Holders

 

You are a “U.S. holder” if you are a beneficial owner of our common stock or our Preferred Stock and you are a U.S. citizen or resident, a U.S. corporation (or other U.S. entity taxable as a corporation), an estate the income of which is subject to U.S. Federal income taxation regardless of its source, or a trust if a court within the United States is able to exercise primary jurisdiction over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of that trust.

 

If a partnership holds our common stock or Preferred Stock, the tax treatment of a partner will generally depend upon the status of the partner and upon the activities of the partnership. If you are a partner in a partnership holding our common stock, you should consult your tax advisor.

 

Distributions on Our Common Stock and Preferred Stock

Subject to the discussion of “passive foreign investment companies” (“PFICs”) below, any distributions with respect to our common stock or Preferred Stock that you receive from us will generally constitute dividends, which may be taxable as ordinary income or “qualified dividend income” as described below, to the extent of our current or accumulated earnings and profits (as determined under U.S. tax principles). Distributions in excess of our earnings and profits will be treated first as a nontaxable return of capital to the extent of your tax basis in our common stock or Preferred Stock (on a dollar-for-dollar basis) and thereafter as capital gain.

 

Because we are not a U.S. corporation, if you are a U.S. corporation (or a U.S. entity taxable as a corporation), you will not be entitled to claim a dividends-received deduction with respect to any distributions you receive from us.

 

Dividends paid with respect to our common stock or Preferred Stock will generally be treated as “passive category income” for purposes of computing allowable foreign tax credits for U.S. foreign tax credit purposes.

 

If you are an individual, trust or estate, dividends you receive from us should be treated as “qualified dividend income”, provided that:

(a) the common stock or Preferred Stock is readily tradable on an established securities market in the United States (such as the New York Stock Exchange);

(b) we are not a PFIC for the taxable year during which the dividend is paid or the immediately preceding taxable year (see the discussion under “PFIC Status” in our annual report);

(c) you own our common stock or our Preferred Stock for more than 60 days in the 121-day period beginning 60 days before the date on which the common stock or Preferred Stock becomes ex-dividend;

(d) you are not under an obligation to make related payments with respect to positions in substantially similar or related property; and

(e) certain other conditions are met.

 

Qualified dividend income is taxed at a preferential maximum rate of 15% or 20%, depending on the income level of the taxpayer.

 

Special rules may apply to any “extraordinary dividend”. Generally, an extraordinary dividend is a dividend in an amount that is equal to (or in excess of) 10% of your adjusted tax basis (or fair market value in certain circumstances) in a share of our common stock (5% in the case of Preferred Stock). If we pay an extraordinary dividend on our common stock or Preferred Stock that is treated as qualified dividend income and if you are an individual, estate or trust, then any loss derived by you from a subsequent sale or exchange of such common stock or Preferred Stock will be treated as long-term capital loss to the extent of such dividend.

 

There is no assurance that dividends you receive from us will be eligible for the preferential rates applicable to qualified dividend income. Dividends you receive from us that are not eligible for the preferential rates will be taxed at the ordinary income rates.

 

Common Shares:

The table below provides a breakdown by quarter of Costamare Inc. cash distribution paid per common share.

 

Declaration Date

Payment Date

Amount Per Share

% Treated as Dividend

% Treated as other than as Dividend

October 4, 2016

November 4, 2016

$0.10

36.80%

63.20%

July 6, 2016

August 17, 2016

$0.29

36.79%

63.21%

April 1, 2016

May, 4 2016

$0.29

36.79%

63.21%

January 4, 2016

February 4, 2016

$0.29

36.79%

63.21%

October 1, 2015

November 4, 2015

$0.29

67.62%

32.38%

July 2, 2015

August 5, 2015

$0.29

67.62%

32.38%

April 1, 2015

May 6, 2015

$0.29

67.62%

32.38%

January 6. 2015

February 4, 2015 

$0.28

67.61%

32.39%

October 7, 2014

November 5, 2014

$0.28

68.12%

31.88%

 July 8, 2014

August 6, 2014

$0.28

68.12%

31.88%

April 29, 2014

May 13, 2014

$0.28

68.12%

31.88%

January 6, 2014

February 4, 2014

$0.27

70.62%

29.38%

October 8, 2013

November 6, 2013

$0.27

100%

0%

July 10, 2013

August 7, 2013

$0.27

100%

0%

April 10, 2013

May 8, 2013

$0.27

100%

0%

January 17, 2013

February 13, 2013

$0.27

100%

0%

October 5, 2012

November 6, 2012

$0.27

100%

0%

July 9, 2012

August 7, 2012

$0.27

100%

0%

April 19, 2012

May 9, 2012

$0.27

100%

0%

January 12, 2012

February 8, 2012

$0.27

100%

0%

October 11, 2011

November 7, 2011

$0.27

100%

0%

July 11, 2011

August 9, 2011

$0.25

100%

0%

April 11, 2011

May 12, 2011

$0.25

100%

0%

January 12, 2011

February 4, 2011

$0.25

100%

0%

 

2016 - Form 8937

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