Core Viewpoint - Adamas Trust, Inc. has announced the tax treatment of its common and preferred stock dividends paid in 2025, providing essential information for stockholders regarding their tax reporting obligations related to these distributions [1][3]. Tax Treatment of Dividends - Stockholders are advised to verify their 2025 tax statements from brokerage firms against the information provided by the company [2]. - No portion of the 2025 dividend distributions is expected to be classified as excess inclusion income, which is relevant for certain tax-exempt investors [3]. - The cash distribution declared in December 2025, which exceeds the company's earnings and profits for 2025, will be treated as a 2026 distribution for federal income tax purposes, resulting in $0.00 reported on the 2025 Form 1099 and $0.23 on the 2026 Form 1099 for stockholders of record as of December 22, 2025 [4]. Dividend Distribution Details - For the 8.000% Series D Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock, total distributions per share for 2025 amount to $2.00, with $1.772612 classified as ordinary dividends [4]. - For the 7.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock, total distributions per share for 2025 are $1.06, with $0.672320 classified as ordinary dividends [5]. - For the 6.875% Series F Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock, total distributions per share for 2025 are $1.7187500, with $1.5233376 classified as ordinary dividends [6]. - For the 7.000% Series G Cumulative Redeemable Preferred Stock, total distributions per share for 2025 are $1.750000, with $1.551036 classified as ordinary dividends [6]. Company Overview - Adamas Trust, Inc. is a Maryland corporation that has elected to be taxed as a real estate investment trust (REIT) for federal income tax purposes, focusing on generating durable earnings and long-term value for stockholders through disciplined portfolio management [8].

Core Viewpoint - High dividend yields, such as 10% or more, can attract income-focused investors but often indicate significant underlying risks associated with the company's financial health [1][2]. Group 1: High-Yield Dividend Stocks - A list of high-yield dividend stocks includes FS KKR Capital Corp. (17.39%), Dynex Capital, Inc. (14.77%), and AGNC Investment Corp. (13.36%) among others, with market caps of at least $2 billion [4][6]. - The dividend yield is calculated as annual dividend divided by stock price, meaning a stock's yield can appear attractive if its price has significantly dropped [5][7]. Group 2: Risks Associated with High-Yield Stocks - A payout ratio exceeding 100% indicates that a company is using its capital to maintain dividends, which is unsustainable and may lead to dividend cuts [5]. - Companies in cyclical sectors may rely on debt to fund dividends during downturns, increasing the risk of bankruptcy [5]. - Investors should assess a company's free cash flow (FCF) to ensure it can sustain high dividend payments, as insufficient cash generation is a red flag [7][8]. Group 3: Tax Considerations - Many high-yield stocks, such as REITs and BDCs, pay non-qualified dividends, which are taxed at higher marginal income tax rates compared to qualified dividends from established companies [9][10]. - It is advisable for investors seeking high yields to consider holding non-qualified stocks in tax-advantaged accounts to mitigate tax liabilities [9].