Federal Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of Reconciliation of Net Income to Taxable Income

Reconciliation of GAAP net income attributable to Acadia to taxable income is as follows:

	Year Ended December 31,
(in thousands)	2020			2019			2018
Net income attributable to Acadia	$	(8,759	)	$	53,045		$	31,439
Deferred cancellation of indebtedness income		—			—			2,050
Deferred rental and other income ^(a)		(2,498	)		1,203			1,222
Book/tax difference - depreciation and amortization ^(a)		27,052			21,688			23,166
Straight-line rent and above- and below-market rent adjustments ^(a)		8,630			(10,949	)		(12,129	)
Book/tax differences - equity-based compensation		6,825			7,177			6,042
Joint venture equity in earnings, net ^(a)		(163	)		15,571			13,905
Impairment charges and reserves		18,734			—			—
Acquisition costs ^(a)		14			63			326
Gain on disposition of properties		4,936			2,375			—
Book/tax differences - miscellaneous		(253	)		(1,473	)		(2,821	)
Taxable income	$	54,518		$	88,700		$	63,200
Distributions declared ^(b)	$	24,937		$	96,310		$	89,122

(a)	Adjustments from certain subsidiaries and affiliates, which are consolidated for financial reporting but not for tax reporting, are included in the reconciliation item “Joint venture equity in earnings, net.”

(b)	The entire fourth quarter 2019 dividend of $25.2 million (paid in January 2020) will be attributed to 2020. Any additional distributions required for REIT qualification may be made through October 15, 2021.

Schedule of Tax Status of Dividends

The Company has determined that the cash distributed to the shareholders for the periods presented is characterized as follows for Federal income tax purposes:

	Year Ended December 31,
	2020					2019					2018
	Per Share		%			Per Share		%			Per Share		%
Ordinary income - Non-Section 199A	$	—		—	%	$	—		—	%		—		—	%
Ordinary income - Section 199A		0.520		90	%		0.820		77	%		0.870		100	%
Qualified dividend		—		—	%		—		—	%		—		—	%
Capital gain		0.060		10	%		0.240		23	%		—		—	%
Total ^(b)	$	0.580		100	%	$	1.060		100	%		0.870		100	%

(c)	The fourth quarter 2019 regular dividend was $0.29 per common share, all of which is allocable to 2020. The fourth quarter 2018 regular dividend was $0.28 per common share of which approximately $0.06 was allocable to 2018 and approximately $0.22 is allocable to 2019.

Schedule of TRS Income and Provision for Income Taxes

Income taxes have been provided for using the liability method as required by ASC Topic 740, “Income Taxes.” The Company’s TRS income and provision for income taxes associated with the TRS for the periods presented are summarized as follows (in thousands):

	Year Ended December 31,
	2020			2019			2018
TRS loss before income taxes	$	(3,856	)	$	(3,117	)	$	(2,609	)
(Provision) benefit for income taxes:
Federal		376			754			(377	)
State and local		(268	)		317			26
TRS net loss before noncontrolling interests		(3,748	)		(2,046	)		(2,960	)
Noncontrolling interests		746			(369	)		4
TRS net loss	$	(3,002	)	$	(2,415	)	$	(2,956	)

Schedule of Effective Income Tax Rate Reconciliation

The income tax provision for the Company differs from the amount computed by applying the statutory Federal income tax rate to income before income taxes as follows. Amounts are not adjusted for temporary book/tax differences (in thousands):

	Year Ended December 31,
	2020			2019			2018
Federal tax benefit at statutory tax rate	$	(810	)	$	(655	)	$	(548	)
TRS state and local taxes, net of Federal benefit		(244	)		(197	)		(165	)
Tax effect of:
Permanent differences, net		227			239			951
Prior year over-accrual, net		—			—			—
Effect of Tax Cuts and Jobs Act		—			—			—
Adjustment to deferred tax reserve		851			1,748			(1,530	)
Other		(131	)		(112	)		1,702
REIT state and local income and franchise taxes		378			445			524
Total provision for income taxes	$	271		$	1,468		$	934