N-30B-2 1 c53197_n30b-2.htm
First Quarter Report 2008

an investment you can live with


Tri-Continental Corporation



May 19, 2008

To the Stockholders:

     The first quarter Stockholder report for Tri-Continental Corporation, covering the three months ended March 31, 2008, follows this letter. In this report you will find the Corporation’s investment results and portfolio of investments.

     For the three months ended March 31, 2008, the Corporation posted a total return of -11.7% based on net asset value, and -13.6% based on market price. During the same period, the S&P 500 Index returned -9.4%, the Lipper Closed-End Core Funds Average returned -10.9%, and the Lipper Large-Cap Core Funds Average returned -10.2%.

     On March 26, 2008, the Corporation paid its first quarter 2008 distribution of $0.633 per share to holders of Tri-Continental Common Stock. The second quarter 2008 distribution of $0.540 per Common share will be paid on June 19, 2008. Both distributions were 2.75% of quarter-end net asset value per share (December 31, 2007 and March 31, 2008, respectively).

     There are several distribution payment options available under the Distribution Policy, and we continue to recommend that Stockholders assess their income needs and consider investing a portion of their distributions in additional shares of Tri-Continental. The payment options are outlined on page 10 of this report. You may change your payment election by contacting your Financial Advisor or by calling Stockholder Services at 800-TRI-1092.

     Tri-Continental Stockholders re-elected four members of the Corporation’s Board of Directors at the Annual Meeting of Stockholders, held on May 15, 2008 in Baltimore, Maryland. Stockholders also ratified Deloitte & Touche LLP as auditors of the Corporation for 2008. Detailed proxy results will be included in the upcoming mid-year Stockholder report, dated June 30, 2008.

     Tri-Continental is now in its 79th year of operations, and we thank you for your continued support of the Corporation and for giving us the opportunity to serve your investment needs. We look forward to many more years doing so.

By order of the Board of Directors,

William C. Morris

Brian T. Zino



Tri-Continental Corporation

Investment Results Per Common Share

For Periods Ended March 31, 2008

Average Annual
Market Price   (13.60 )%   (12.86 )%   (0.06 )%   4.82 %   10.38 %   2.03 %
Net Asset Value   (11.69 )   (13.34 )   (0.78 )   3.05     9.56     1.29  
Lipper Closed-End Core                                    
   Funds Average**
  (10.93 )   (9.75 )   0.46     4.18     11.15     3.37  
Lipper Large-Cap Core                                    
   Funds Average**
  (10.22 )   (5.54 )   1.91     4.94     10.13     2.74  
S&P 500 Index**   (9.44 )   (5.07 )   3.02     5.84     11.30     3.50  

    March 31, 2008       December 31, 2007
Market Price   $17.42     $20.90  
Net Asset Value   19.62   23.03

For Periods Ended March 31, 2008

  Capital Gain (Loss)  
            SEC 30-Day
  $(1.13 )   $0.67   $(4.29 )   2.96 %


Performance data quoted in this report represents past performance and does not guarantee or indicate future investment results. The rates of return will vary and the principal value of an investment will fluctuate. Shares, if sold, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Total returns of the Corporation as of the most recent month end will be made available at www.seligman.com1 by the seventh business day following that month end.

J. & W. Seligman & Co. Incorporated, the investment manager of the Corporation, made certain payments to the Corporation in 2004. Absent such payments, the net asset value returns that include this period would have been lower. Returns reflect changes in market price or net asset value, as applicable, and assume reinvestment of distributions. Performance data quoted does not reflect the deduction of taxes that investors may pay on distributions or the sale of shares. Distributions are expected to consist of net investment income and either one or both of net realized capital gains and return of capital. A return of capital distribution does not necessarily reflect the Corporation’s investment performance and should not be confused with “yield” or “income.” An investment in Tri-Continental is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation.


See footnotes on page 3.


Tri-Continental Corporation

Investment Results Per Common Share (continued)


  Returns for periods of less than one year are not annualized.


**    The Lipper Closed-End Core Funds Average and the Lipper Large-Cap Core Funds Average (the “Lipper Averages”) and the Standard & Poor’s 500 Composite Stock Price Index (the “S&P 500 Index”) are unmanaged benchmarks that assume reinvestment of all distributions. The Lipper Averages exclude the effect of fees, sales charges, and taxes, and the S&P 500 Index excludes the effect of expenses, fees, taxes, and sales charges. The Lipper Closed-End Core Funds Average measures the performance of closed-end funds that, by portfolio practice, typically have an average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index. The Lipper Large-Cap Core Funds Average includes open-end funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) greater than 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. The Lipper Large-Cap Core Funds Average is provided for comparative purposes so that the Corporation’s performance can be measured against both closed-end and open-end funds with similar portfolio holdings as the Corporation. Lipper classifies the Corporation, based on its portfolio holdings, as a Closed-End Core Fund. The S&P 500 Index measures the performance of 500 of the largest US companies based on market capitalizations. Investors cannot invest directly in an index or an average.


  Preferred Stockholders were paid dividends totaling $0.625 per share.


  Represents the per share amount of gross unrealized gain or loss of portfolio securities as of March 31, 2008.


  Current yield, representing the annualized yield for the 30-day period ended March 31, 2008, has been computed in accordance with SEC regulations and will vary.


  The website reference is an inactive textual reference and information contained in or otherwise accessible through the website does not form a part of this report or the Corporation’s prospectus or statement of additional information.












Tri-Continental Corporation

Ten Largest Equity Holdings†
March 31, 2008

Exxon Mobil Corporation   $ 51,398   $ 67,241
Gemstar-TV Guide International, Inc.     77,730     61,508
Rite Aid Corporation     87,844     52,395
Comverse Technology, Inc.     67,015     51,495
JPMorgan Chase & Co.     47,740     47,546
General Electric Company     43,752     44,490
AT&T Inc.     43,885     42,678
Philip Morris International Inc.     36,635     42,410
Microsoft Corporation     43,837     41,998
Marvell Technology Group Ltd.     57,008     38,304
    $ 556,844   $ 490,065

There can be no assurance that the securities presented have remained or will remain in the Corporation’s portfolio. Information regarding the Corporation’s portfolio holdings should not be construed as a recommendation to buy or sell any security or as an indication that any security is suitable for a particular investor.


†    Excludes options purchased.

Largest Portfolio Changes
January 1 to March 31, 2008

Largest Purchases   Largest Sales
Merck & Co., Inc.*   Wal-Mart Stores, Inc.**
United Parcel Service Inc. (Class B)                               Joy Global Inc.**
UST Inc.*   NII Holdings, Inc.
Nokia Corporation (ADR)*   Halliburton Company
Marvell Technology Group Ltd.   Starbucks Corporation**
AT&T Inc.   Activision, Inc.**
Wynn Resorts, Limited*   Wyeth
Microsoft Corporation   Maxim Integrated Products, Inc.**
Google Inc. (Class A)*   Coach, Inc.**
Wells Fargo & Company*   ConocoPhillips

Largest portfolio changes from the previous period to the current period are based on cost of purchases and proceeds from sales of securities, listed in descending order.



*    Position added during the period.
**   Position eliminated during the period.


Tri-Continental Corporation

Portfolio of Investments (unaudited)  
March 31, 2008

COMMON STOCKS 94.1%          
   DEFENSE 2.9%          
Boeing Company (The)   137,900   $       10,255,623
General Dynamics Corporation   141,800     11,821,866
Honeywell International Inc.   382,700     21,591,934
United Technologies Corporation   237,200     16,324,104
   LOGISTICS 1.1%          
United Parcel Service Inc.          
     (Class B)   310,900     22,701,918
AIRLINES 0.7%          
AMR Corporation*   606,600     5,471,532
Delta Air Lines, Inc.*   466,329     4,010,429
Northwest Airlines Corporation*   479,800     4,313,402
AUTO COMPONENTS 0.6%          
Goodyear Tire & Rubber          
     Company (The)*   474,300     12,236,940
AUTOMOBILES 0.4%          
General Motors Corporation   433,300     8,254,365
BIOTECHNOLOGY 1.9%          
Amgen Inc.*   193,600     8,088,608
Cephalon, Inc.*   346,700     22,327,480
ImClone Systems Incorporated*   225,000     9,544,500
CAPITAL MARKETS 3.0%          
Bank of New York Mellon          
     Corporation (The)   241,600     10,081,968
Fortress Investment Group          
     LLC (Class A)   1,603,482     19,690,759
Goldman Sachs Group,          
     Inc. (The)   52,350     8,658,167
Lehman Brothers Holdings Inc.   192,500     7,245,700
Morgan Stanley   377,300     17,242,610
CHEMICALS 0.4%          
Monsanto Company   73,200     8,161,800
COMMERCIAL BANKS 2.1%          
PNC Financial Services          
     Group, Inc. (The)   185,300   $       12,150,121
Wachovia Corporation   508,363     13,725,801
Wells Fargo & Company   600,700     17,480,370
   AND SUPPLIES 0.6%          
Waste Management Inc.   367,000     12,316,520
   EQUIPMENT 6.9%          
Cisco Systems, Inc.*   1,107,180     26,671,966
Comverse Technology, Inc.*   3,321,214     51,495,423
Nokia Corporation (ADR)   604,000     19,225,320
QUALCOMM Inc.   640,300     26,252,300
Research in Motion Limited*   172,500     19,359,675
   PERIPHERALS 3.9%          
Apple Inc.*   153,100     21,969,850
Hewlett-Packard Company   606,600     27,697,356
International Business Machines   174,800     20,126,472
Seagate Technology   488,858     10,236,687
   ENGINEERING 0.8%          
Foster Wheeler Ltd.*   165,400     9,364,948
Quanta Services, Inc.*   289,600     6,710,032
CONSUMER FINANCE 0.7%          
American Express Company   351,200     15,354,464
   PACKAGING 1.8%          
Smurfit-Stone Container          
     Company*   4,777,704     36,788,321
   SERVICES 4.1%          
Bank of America Corporation   919,140     34,844,597
CIT Group Inc.   248,800     2,948,280
JPMorgan Chase & Co.   1,107,000     47,545,650


See footnotes on page 9.


Tri-Continental Corporation

Portfolio of Investments (unaudited)  
March 31, 2008

   SERVICES 3.1%          
AT&T Inc.   1,114,300   $       42,677,690
Qwest Communications          
     International Inc.   1,996,996     9,046,392
Time Warner Telecom,          
     Inc. (Class A)*   813,500     12,601,115
Exelon Corporation   208,700     16,961,049
   AND SERVICES 3.2%          
Baker Hughes Incorporated   154,200     10,562,700
Halliburton Company   376,700     14,815,611
Noble Corporation   251,600     12,496,972
Schlumberger Limited   184,700     16,068,900
Transocean Inc.*   94,400     12,762,880
   RETAILING 3.3%          
CVS Caremark Corporation   395,800     16,033,858
Rite Aid Corporation*   17,821,351     52,394,772
   AND SUPPLIES 1.7%          
Baxter International Inc.   160,200     9,262,764
St. Jude Medical, Inc.*   334,400     14,442,736
Zimmer Holdings, Inc.*   161,800     12,597,748
   AND SERVICES 1.4%          
Express Scripts, Inc.*   168,700     10,850,784
Health Net. Inc.*   84,975     2,617,230
Quest Diagnostics Inc.   233,500     10,570,545
UnitedHealth Group          
     Incorporated   119,980     4,122,513
   AND LEISURE 0.8%          
Wynn Resorts, Limited*   169,900     17,098,736
   PRODUCERS AND          
   ENERGY TRADERS 0.5%          
AES Corporation (The)*   669,600   $       11,162,232
   CONGLOMERATES 2.6%          
3M Company   109,600     8,674,840
General Electric Company   1,202,100     44,489,721
INSURANCE 3.6%          
American International          
     Group, Inc.   483,300     20,902,725
Hartford Financial Services          
     Group, Inc.   283,100     21,450,487
MetLife, Inc.   314,600     18,957,796
Prudential Financial, Inc.   176,434     13,805,961
   AND SERVICES 2.6%          
Google Inc. (Class A)*   29,100     12,817,677
SAVVIS, Inc.*   1,309,970     21,313,212
Yahoo!, Inc.*   707,712     20,474,108
   AND SERVICES 0.7%          
Applera Corporation   471,300     15,486,918
MACHINERY 0.9%          
Caterpillar Inc.   155,300     12,158,437
Deere & Company   86,700     6,974,148
MEDIA 3.8%          
Comcast Corporation (Class A)   381,400     7,376,276
Gemstar-TV Guide          
     International, Inc.*   13,086,820     61,508,054
Time Warner Inc.   736,700     10,328,534
METALS AND MINING 2.3%          
Alcoa Inc.   529,613     19,097,845
Freeport-McMoRan Copper          
     & Gold, Inc. (Class B)   299,900     28,856,378


See footnotes on page 9.


Tri-Continental Corporation

Portfolio of Investments (unaudited)  
March 31, 2008

MULTILINE RETAIL 2.2%          
Kohl’s Corporation*   496,211   $       21,282,490
Target Corporation   501,900     25,436,292
OIL, GAS AND          
   CONSUMABLE FUELS 8.5%          
Chevron Corporation   407,700     34,801,272
ConocoPhillips   337,100     25,690,391
El Paso Corporation   1,268,700     21,111,168
Exxon Mobil Corporation   795,000     67,241,100
Valero Energy Corporation   196,100     9,630,471
XTO Energy Inc.   276,125     17,081,092
PHARMACEUTICALS 7.4%          
Abbott Laboratories   356,100     19,638,915
Bristol-Myers Squibb Company   907,800     19,336,140
Forest Laboratories, Inc.*   234,900     9,398,349
Johnson & Johnson   215,400     13,972,998
Merck & Co., Inc.   470,800     17,866,860
Mylan Laboratories Inc.*   892,100     10,348,360
Pfizer Inc.   1,145,138     23,967,738
Schering-Plough Corporation   503,300     7,252,553
Sepracor Inc.*   259,900     5,073,248
Wyeth   640,434     26,744,524
   EQUIPMENT 3.5%          
Intel Corporation   971,800     20,582,724
Marvell Technology          
     Group Ltd.*   3,520,581     38,303,921
NVIDIA Corporation*   428,000     8,470,120
QIMONDA AG (ADR)*   1,042,521     4,493,266
SOFTWARE 3.4%          
Adobe Systems Incorporated*   42,965     1,529,124
BMC Software Inc.*   280,200     9,112,104
Microsoft Corporation   1,479,856     41,998,313
Oracle Corporation*   900,100     17,605,956
    Shares or Shares      
Subject to Call
SPECIALTY RETAIL 1.7%          
Home Depot, Inc. (The)   308,200   $ 8,620,354
OfficeMax Incorporated   1,344,192           25,727,835
THRIFTS AND          
   FINANCE 0.0%          
Countrywide Financial          
     Corporation   1     6
TOBACCO 3.8%          
Altria Group, Inc.   838,480     18,614,256
Philip Morris International          
     Inc.*   838,480     42,410,318
UST Inc.   338,600     18,460,472
   SERVICES 0.4%          
NII Holdings, Inc.*   264,700     8,412,166
BIOTECHNOLOGY 0.0%          
Amgen Inc., Call expiring          
     January 2009 at $60   394,300     264,181
CAPITAL MARKETS 0.0%          
Lehman Brothers Holdings          
     Inc., Call expiring          
     January 2009 at $80   387,300     213,015
   EQUIPMENT 0.2%          
JDS Uniphase Corporation, Call      
     expiring January 2009 at $15   994,900     1,492,350
Motorola, Inc., Call expiring          
     January 2009 at $20   1,096,200     109,620
QUALCOMM Inc., Call          
     expiring January 2009 at $40   313,200     1,847,880


See footnotes on page 9.


Tri-Continental Corporation

Portfolio of Investments (unaudited)  
March 31, 2008

Subject to Call
   SERVICES 0.0%          
CIT Group Inc., Call expiring          
     January 2009 at $35   303,600   $ 151,800
Citigroup Inc., Call expiring          
     January 2009 at $30   323,900     411,353
   RETAILING 0.0%          
Rite Aid Corporation, Call          
     expiring January 2009 at $5   3,495,200            1,223,320
   AND LEISURE 0.0%          
Starbucks Corporation, Call          
     expiring January 2009 at $30   583,400     116,680
INDEX DERIVATIVES 0.2%          
Financial Select Sector SPDR,          
     Call expiring January 2009          
     at $30   714,300     964,305
Powershares, Call expiring          
     December 2008 at $48   646,500     1,593,621
SPDR Trust, Call expiring          
     December 2008 at $140   161,600     1,163,520
   AND SERVICES 0.3%          
Yahoo!, Inc., Call expiring          
     January 2009 at $25   728,200     4,369,200
Yahoo!, Inc., Call expiring          
     January 2009 at $30   556,300     1,418,565
PHARMACEUTICALS 0.1%          
Bristol-Myers Squibb Company,          
     Call expiring January 2009          
     at $25   454,000     426,760
Wyeth, Call expiring July 2008          
     at $42.50   413,100     1,321,920
  Shares Subject to      
  Call, Partnership      
  Interest or      
  Principal Amount      
   EQUIPMENT 0.1%        
Marvell Technology        
     Group, Ltd., Call expiring        
     January 2009 at $15
Marvell Technology        
     Group, Ltd., Call expiring        
     January 2009 at $20 908,200     227,050
Micron Technology Inc.,        
     Call expiring        
     January 2009 at $15 2,142,400     321,360
TOTAL OPTIONS PURCHASED           18,483,440
   PARTNERSHIP† 0.1%        
WCAS Capital        
     Partners II, L.P. $4,292,803     2,572,454
   HOLDINGS 6.3%        
Deutsche Bank:        
     39%, 9/5/08 (a)
Goldman Sachs Group:
     35.5%, 4/21/08 (b)
     34.6%, 10/2/08 (c)
Lehman Brothers:
     53.51%, 9/14/08 (d)
     39.5%, 10/2/08 (e)
Morgan Stanley:
     43.3%, 5/15/08 (f)
     NOTES       71,608,734


See footnotes on page 9.


Tri-Continental Corporation

Portfolio of Investments (unaudited)  
March 31, 2008

    Principal Amount         Value  
TIME DEPOSIT 2.8%            
Bank of Montreal,            
     2.25%, 4/1/2008   $58,973,000   $ 58,973,000  
TOTAL SHORT-TERM            
     HOLDINGS         130,581,734  
     INVESTMENTS 101.4%         2,105,960,726  
     LIABILITIES (1.4)%         (29,144,178 )
NET INVESTMENT            
     ASSETS 100.0%       $ 2,076,816,548  


At March 31, 2008, the cost of investments for federal income tax purposes was $2,499,949,837. The tax basis gross unrealized appreciation and depreciation of portfolio securities were $70,031,216 and $464,020,327, respectively.


  Non-income producing security.


   At March 31, 2008, Tri-Continental Corporation owned one limited partnership investment that was purchased through a private offering and cannot be sold without prior registration under the Securities Act of 1933 or pursuant to an exemption therefrom. The investment is valued at fair value as determined in accordance with procedures approved by the Board of Directors of the Corporation. The acquisition dates of investment in the limited partnership, along with the cost and value at March 31, 2008, was as follows:
     Investment   Acquisition Dates       Cost       Value
WCAS Capital Partners II, L.P.   12/11/90 to 3/24/98   $4,292,803   $2,572,454

   The security may be offered and sold only to a “qualified institutional buyer” under Rule 144A of the Securities Act of 1933. These notes are exchangeable at maturity, based on the terms of the respective notes, for shares of common stock of a company or cash at a maturity value which is generally determined as follows:


    The principal amount of the notes plus or minus the lowest return of the companies’ respective stock prices determined at maturity from the date of purchase of the notes:


    (a)    Oracle Corporation, Schering-Plough Corporation and Target Corporation


    (b) Comverse Technology, Inc., Northwest Airlines Corporation and Qwest Communications International Inc.


    (c) Adobe Systems Incorporated, UnitedHealth Group Incorporated and Wyeth


    (d) Delta Air Lines, Inc., Intel Corporation and Mylan Inc.


    (e) Health Net, Inc., Kohl’s Corporation and Prudential Financial, Inc.


    (f) NII Holdings, Inc., Office Depot, Inc. and Qwest Communications International Inc.

ADR — American Depositary Receipts.

Security Valuation — Securities traded on an exchange are valued at the last sales price on the primary exchange or market on which they are traded. Securities not listed on an exchange or security market, or securities for which there is no last sales price, are valued at the mean of the most recent bid and asked prices or are valued by J. & W. Seligman & Co. Incorporated (the “Manager”) based on quotations provided by primary market makers in such securities. Securities for which market quotations are not readily available (or are otherwise no longer valid or reliable) are valued at fair value determined in accordance with procedures approved by the Board of Directors. This can occur in the event of, among other things, natural disasters, acts of terrorism, market disruptions, intra-day trading halts, and extreme market volatility. The determination of fair value involves subjective judgments. As a result, using fair value to price a security may result in a price materially different from the prices used by other investment companies to determine net asset value or the price that may be realized upon the actual sale of the security. Short-term holdings maturing in 60 days or less are valued at current market quotations or amortized cost if the Manager believes it approximates fair value. Short-term holdings that mature in more than 60 days are valued at current market quotations until the 60th day prior to maturity and are then valued as described above for securities maturing in 60 days or less.

Fair Value Measurement — On January 1, 2008, the Corporation adopted Statement of Financial Accounting Standards No. 157 (“SFAS 157”), “Fair Value Measurements.” SFAS 157 establishes a three-tier hierarchy to classify the assumptions, referred to as inputs, used in valuation techniques (see Security Valuation above) to measure fair value of the Corporation’s investments. These inputs are summarized in three broad levels: Level 1 –quoted prices in active markets for identical investments; Level 2 – other significant observable inputs (including quoted prices in inactive markets or for similar investments); and Level 3 – significant unobservable inputs (including the Corporation’s own assumptions in determining fair value). The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities.

The following is a summary of the value of the Corporation’s investments as of March 31, 2008 based on the level of inputs used:

Valuation Inputs
Level 1
Quoted Prices  
Level 2
Other Significant Observable Inputs     130,581,734
Level 3
Significant Unobservable Inputs     2,572,454

As required by SFAS 157, the following is a reconciliation of investments for which significant unobservable inputs (Level 3) were used to determine the fair value of investments classified as Level 3 at either the beginning or end of the period:

Balance as of December 31, 2007  
Net change in unrealized depreciation     787,498
Balance as of March 31, 2008  
Net change in unrealized depreciation from  
 investments still held as of March 31, 2008  

Risk — To the extent that the Corporation invests a substantial percentage of its assets in an industry, the Corporation’s performance may be negatively affected if that industry falls out of favor. Stocks of large-capitalization companies have at times experienced periods of volatility and negative performance. During such periods, the value of such stocks may decline and the Corporation’s performance may be negatively affected.


Tri-Continental Corporation

Stockholder Services

     Tri-Continental provides a number of services to make maintaining an investment in its Common Stock more convenient. Please consult Tri-Continental’s prospectus for the terms and conditions of these services.

Distribution Policy. Holders of Tri-Continental Common Stock will receive quarterly distributions equal to a minimum of 2.75% of the net asset value of Tri-Continental’s Common Stock on the last business day of the preceding calendar quarter (approximately 11% annually). The payment options for receiving distributions are:

  • 100% of distribution to be invested in additional shares of Tri-Continental
  • 75% of distribution to be invested in additional shares, 25% of distribution to be paid in cash
  • 50% of distribution to be invested in additional shares, 50% of distribution to be paid in cash
  • 100% of distribution to be paid in cash

     You can change your payment election at any time by contacting your financial advisor or Stockholder Services at 800-TRI-1092.

Automatic Dividend Investment and Cash Purchase Plan. Subject to the terms and conditions set forth in the prospectus, Stockholders may automatically purchase additional shares with distribution payments. There is no charge for this service. Stockholders may also, subject to the terms and conditions of the prospectus, purchase additional shares directly from the Corporation. There is a service fee of a maximum of $2.00 for each cash purchase transaction.

Automatic Cash Withdrawal Plan. Stockholders who hold Common Stock with a market value of $5,000 or more may elect to receive a fixed amount from their investment at regular intervals by selling their shares to the Corporation.

Traditional Individual Retirement Account (IRA). Stockholders who have earned income and are under age 70½ may contribute up to $5,000 per year to a Traditional IRA for 2008. A working or non-working spouse may also contribute up to $5,000 to a separate Traditional IRA for 2008. Additionally, individuals who reach age 50 prior to the end of a taxable year may make “catch-up contributions” to a Traditional IRA of up to $1,000. Contributions to a Traditional IRA may be deductible or non-deductible. If you are single and not covered by an employer’s retirement plan, your contribution will always be deductible. For individuals who are covered by a plan, contributions will be fully deductible if your modified adjusted gross income (MAGI) in 2008 is less than $53,000. For spouses who are both covered by a plan, contributions will be fully deductible if your MAGI is less than $85,000. If one spouse does not work or is not covered by a retirement plan, that spouse’s contribution will be fully deductible provided your household MAGI does not exceed $159,000. If your contribution is not deductible, you may still take advantage of the tax-deferred accumulation of earnings in your Traditional IRA.

Rollover IRA. You may be eligible to roll over a distribution of assets received from another IRA, a qualified employee benefit plan, or tax-deferred annuity into a Rollover IRA with Tri-Continental. To avoid a tax penalty, the transfer to a Rollover IRA must occur within 60 days of receipt of the qualifying distribution. If you do not make a direct transfer of a distribution from a qualified employee benefit plan or a tax-deferred annuity to a Rollover IRA, the payor of the distribution must withhold 20% of the distribution.


Tri-Continental Corporation

Stockholder Services (continued)

Roth IRA. You (and a working or non-working spouse) may (each) make an after-tax contribution of up to $5,000 per year to a Roth IRA provided you have earned income and meet the eligibility requirements. Your MAGI must be less than $101,000 for individuals or $159,000 for married couples to be eligible to make a full contribution to a Roth IRA. You are eligible to make a partial Roth IRA contribution if your MAGI is below $116,000 for individuals or $169,000 for married couples. Total combined contributions to a Roth IRA and a Traditional IRA cannot exceed $5,000 in any year. Additionally, individuals who reach age 50 prior to the end of a taxable year may make “catch-up contributions” to either a Roth IRA or Traditional IRA of up to $1,000. Earnings grow tax-free and will be distributed to you tax-free and penalty-free provided that you hold your account for at least five years and you take the distribution either after age 59½, for disability, upon death, or to make a first-time home purchase (up to $10,000). Unlike a Traditional IRA, you may contribute to a Roth IRA even if you are over age 70½ (if you have earned income), and you are not required to take minimum distributions at age 70½. You may convert an existing Traditional IRA to a Roth IRA to take advantage of tax-free distributions. You must pay taxes on any earnings and deductible contributions in your Traditional IRA when converting it to a Roth IRA. Talk to your financial advisor for more details on converting your Traditional IRA.

Retirement Planning — Qualified Plans. Unincorporated businesses and the self-employed may take advantage of the same benefits in their retirement plans that are available to corporations. Contribution levels can go as high as 100% of earned income (reduced by plan contributions), to a maximum of $46,000 per participant. For retirement plan purposes, no more than $230,000 may be taken into account as earned income under the plan in 2008. Social Security integration and employee vesting schedules are also available as options in the Tri-Continental prototype retirement plans. Although you already may be participating in an employer’s retirement plan, you may be eligible to establish another plan based upon income from other sources, such as director’s fees.

Retirement Plan Services provides information about our prototype retirement plans. The toll-free telephone number is (800) 445-1777 in the US and (212) 682-7600 outside the US.








Tri-Continental Corporation

Board of Directors

Maureen Fonseca (2,3)
Head of School, The Masters School
Trustee, New York State Association of Independent
  Schools and Greens Farms Academy
Commissioner, Middle States Association

John R. Galvin (1,3)
Dean Emeritus, Fletcher School of Law
  and Diplomacy at Tufts University
Chairman Emeritus, American Council
  on Germany

John F. Maher (1,3)
Retired President and Chief Executive Officer,
  and Former Director,
  Great Western Financial Corporation and its
  principal subsidiary, Great Western Bank

Frank A. McPherson (2,3)
Retired Chairman of the Board and Chief Executive
  Officer, Kerr-McGee Corporation
Director, DCP Midstream GP, LLP, Integris
  Health, Oklahoma Medical Research Foundation,
  Oklahoma Foundation for Excellence in Education,
  National Cowboy and Western Heritage Museum, and
  Oklahoma City Museum of Art

Betsy S. Michel (2,3)
Trustee, The Geraldine R. Dodge Foundation and
  Drew University
William C. Morris
Chairman and Director, J. & W. Seligman & Co.
  Incorporated, Carbo Ceramics Inc., Seligman
  Advisors, Inc., and Seligman Services, Inc.
Director, Seligman Data Corp.
President and Chief Executive Officer,
  The Metropolitan Opera Association

Leroy C. Richie (1,3)
Counsel, Lewis & Munday, P.C.
Director, Vibration Control Technologies, LLC
  and OGE Energy Corp.
Lead Outside Director, Digital Ally Inc. and
  Infinity, Inc.
Director and Chairman, Highland Park Michigan
  Economic Development Corp.
Chairman, Detroit Public Schools Foundation

Robert L. Shafer (2,3)
Ambassador and Permanent Observer of the Sovereign
  Military Order of Malta to the United Nations

James N. Whitson (1,3)
Retired Executive Vice President and Chief Operating
  Officer, Sammons Enterprises, Inc.
Director, CommScope, Inc.

Brian T. Zino
Director and President,
  J. & W. Seligman & Co. Incorporated
Director, Seligman Advisors, Inc. and
  Seligman Services, Inc.
Chairman, Seligman Data Corp.
Member of the Board of Governors,
  Investment Company Institute


Member:   (1) Audit Committee
  (2) Director Nominating Committee
  (3) Board Operations Committee





Tri-Continental Corporation

Executive Officers

William C. Morris

Brian T. Zino
President and Chief Executive Officer

John B. Cunningham
Vice President

Eleanor T.M. Hoagland
Vice President and Chief Compliance Officer

Charles W. Kadlec
Vice President
Thomas G. Rose
Vice President

Lawrence P. Vogel
Vice President and Treasurer

Erik J. Voss
Vice President

Frank J. Nasta

Marco F. Acosta
Assistant Vice President










Tri-Continental Corporation

Additional Fund Information

J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, NY 10017

Stockholder Service Agent
Seligman Data Corp.
100 Park Avenue
New York, NY 10017

Mail Inquiries to:
P.O. Box 9759
Providence, RI 02940-9759

Important Telephone Numbers

(800) TRI-1092       Stockholder Services
(800) 445-1777   Retirement Plan Services
(212) 682-7600   Outside the United States
(800) 622-4597   24-Hour Automated
Telephone Access Service


This report is intended only for the information of Stockholders who have received the current prospectus covering shares of Common Stock of Tri-Continental Corporation, which contains information about investment objectives, risks, management fees and other costs. The prospectus should be read carefully before investing and may be obtained by calling Stockholder Services at 800-TRI-1092.