REIT Distribution Calculator

A REIT distribution calculator (also called a REIT income calculator or real estate investment trust calculator) is a financial tool that computes the expected distribution income from investing in Real Estate Investment Trusts (REITs). REITs are companies that own, operate, or finance income-producing real estate and are required by law to distribute at least 90% of their taxable income to shareholders as dividends. Unlike regular stock dividends, REIT distributions typically consist of three components: ordinary income (taxed at regular income rates), capital gains (taxed at favorable long-term rates), and return of capital (tax-deferred - reduces your cost basis). Our REIT distribution calculator helps you estimate your expected income, understand the tax treatment, project growth with reinvestment, and compare REIT yields against bonds and stocks.

1. 1. Enter Investment & REIT Details: Start by entering your investment amount, the current share price of the REIT, and the annual distribution per share. Select the distribution frequency (monthly, quarterly, semi-annual, or annual) - most REITs pay quarterly distributions. The REIT distribution calculator automatically computes the number of shares you can purchase and the per-distribution payment amount.
2. 2. Configure Tax Type Allocation & Comparisons: Adjust the allocation of your distribution among ordinary income, capital gains, and return of capital using the sliders - these percentages are often reported in the REIT's annual tax breakdown. Enter comparison yields for bonds and stock dividends to see how REIT income stacks up against other investments. Set the projection period (1-50 years) to model long-term growth with DRIP reinvestment.
3. 3. Review Income, Tax Breakdown & Projections: The REIT calculator displays your annual distribution income, per-payment amount, distribution yield, and a detailed tax type breakdown with a stacked bar chart. A comparison chart shows REIT distributions vs bond interest vs stock dividends side by side. The projection chart and table show annual income, cumulative income, and total portfolio value for each year with reinvestment - helping you visualize the power of compounding in REIT investing.

• Distribution Yield: The annual distribution income divided by your investment amount, expressed as a percentage. This is the most commonly cited REIT metric. A REIT yielding 6% on a $25,000 investment generates $1,500 in annual distribution income. Note that REIT yields are typically higher than bond yields but come with greater price volatility.
• Per-Distribution Amount: The income you receive each payment period. For a quarterly-paying REIT with $1,200 annual income, you receive $300 per quarter. For monthly REITs, the per-distribution amount is one-twelfth of the annual income - providing more regular cash flow for income-focused investors.
• Tax Type Breakdown:REIT distributions are typically split into ordinary income (taxed up to 37% + NIIT), capital gains (taxed at 0-20% for long-term), and return of capital (tax-deferred - reduces your cost basis). The calculator shows the dollar amount in each category based on the allocation you provide, which is typically reported on the REIT's Form 1099-DIV each year.
• Projected Growth with DRIP: Demonstrates the power of compounding by assuming distributions are reinvested to purchase additional shares at the same yield. Over 10 years, a $25,000 investment at 6% yield with DRIP grows to over $44,000 - with cumulative income exceeding $19,000.
• Yield Comparison: A side-by-side comparison of the annual income from REIT distributions vs bond interest and stock dividends at the yields you specify. This helps you evaluate the relative income potential of different asset classes for your portfolio.

Understanding the tax treatment of REIT distributions is crucial for accurate income planning: Ordinary income portions are taxed at your marginal income tax rate (up to 37% federal plus 3.8% Net Investment Income Tax). Capital gains portions benefit from preferential long-term capital gains rates (0%, 15%, or 20% depending on your income level). Return of capital (ROC)is not taxed immediately - it reduces your cost basis in the REIT shares, and the tax is deferred until you sell the shares (where it may be taxed as capital gains). Many REIT investors appreciate return of capital because it defers taxes and can create more favorable tax treatment over the long term. Note that the actual allocation percentages vary by REIT and year - always refer to the REIT's Form 1099-DIV and annual tax reporting for exact figures. This calculator provides estimates based on the allocation you specify. All calculations run locally in your browser - no data is sent to any server.