Return of Capital

Redwood Trust has provided 2025 dividend tax guidance for its common and preferred stock. For common stock, approximately 39% is expected to be ordinary income (eligible for Section 199A deduction), 2% qualified dividends, and 59% return of capital. Preferred stock dividends are projected to be 96% ordinary income and 4% qualified dividends. No portion is expected to be unrelated business taxable income. Investors should consult tax advisors.

Cohen & Steers REIT and Preferred and Income Fund (RNP) detailed its January distribution sources, predominantly a return of capital. The fund utilizes a managed distribution policy to offer consistent monthly payouts, allowing for flexibility in realizing capital gains. While distributions may include net investment income and capital gains, a portion can be a return of capital, reducing the shareholder’s cost basis. Investors are advised that distribution amounts do not solely indicate performance and that final tax characterization is determined annually.

The DoubleLine Income Solutions Fund (DSL) declared a $0.11 per share distribution for January 2026. The fund aims for high current income through investments in debt securities, including high-yield and mortgage-backed assets, with potential global exposure. While attractive, this strategy carries risks like interest rate sensitivity and credit risk. Distributions may include a return of capital, with final tax details provided annually on Form 1099-DIV. Investors should consult advisors and review fund risks before investing.

Brookfield Real Assets Income Fund declared its Q1 2026 monthly distribution schedule, maintaining a consistent $0.1180 per share payout. Key dates for January, February, and March 2026 distributions are detailed, with payments expected later in each respective month. Investors should be aware that a portion of these distributions may be classified as a return of capital, impacting tax planning. Final tax characterization will be available on Form 1099-DIV.

Cohen & Steers Infrastructure Fund (UTF) announced its November 28 distribution, a $0.15 per‑share payment composed entirely of return of capital, bringing the year‑to‑date (YTD) total distribution to $1.70 per share. The fund’s managed distribution policy, in place since 2015, allows monthly fixed payouts drawn from net investment income, capital gains and return of capital. YTD performance shows a 13.48% total return and a 6.70% distribution rate; over the past five years, the fund delivered a 10.46% annualized return and a 7.31% annualized distribution rate. Investors are cautioned that part of the payout reflects capital return and should review the prospectus and tax implications.

BlackRock closed-end funds BMEZ, BSTZ, and BTX will switch to level monthly distributions starting October 2025 (ex-date 10/15/2025). The fixed per-share amounts are: BMEZ $0.11000, BSTZ $0.16250, and BTX $0.05250. As of 8/29/2025, significant portions of recent distributions were return of capital for BMEZ and BTX, while BSTZ showed long-term gains. Annualized distribution rates as of 7/31/2025: BMEZ 13.04%, BSTZ 11.37%, BTX 12.32%. Boards can amend plans; distributions impact NAV.

On November 3, 2025, Saba Capital Income & Opportunities Fund II (SABA) announced a monthly dividend of $0.058 per share, payable November 28, 2025, to shareholders of record on November 11, 2025. The fund operates under a managed distribution plan, potentially using capital gains or return of capital to maintain the fixed payout, which could affect NAV. The plan can be amended or terminated, impacting share price. Investors should review Rule 19a-1 notices and understand the fund’s diverse portfolio and associated risks, detailed in SEC filings.

Franklin Universal Trust (FT) announced the estimated sources of its October 31, 2025 distribution and fiscal year 2026 year-to-date allocations. The distribution is $0.0425 per share, with 61% from net investment income, 4% from short-term capital gains, and 35% as return of capital. FT’s investment objective is high current income and capital preservation. The fund’s 5-year average annual total return is 8.06%. Franklin Templeton manages the fund, with $1.66 trillion AUM as of September 30, 2025.

BlackRock Health Sciences Term Trust (BMEZ), BlackRock Science and Technology Term Trust (BSTZ), and BlackRock Technology and Private Equity Term Trust (BTX) will shift from floating to fixed-rate distributions in October 2025. This aims to provide predictable income, stabilize payouts and maintain competitive yields. The change reflects concerns about distribution sustainability and a desire to manage capital effectively. Distribution amounts remain subject to board discretion. Performance should not be evaluated solely on distribution amounts. Investors should consult BlackRock’s website for fund updates.

Saba Capital Income & Opportunities Fund II (SABA) announced the breakdown of its August 29th distribution of $0.058 per share. As of August 22nd, 36.14% is net investment income and 63.86% is return of capital. Fiscal year-to-date, 42.50% is net investment income, and 57.50% is return of capital. SABA cautions against drawing conclusions from distribution figures, as a significant portion is return of capital. The fund targets a $0.058/share monthly distribution, but this is subject to change. Investors should review SEC filings for risk factors.