Which of the following are TRUE of a REIT?
I. It can qualify as a regulated investment company under Subchapter M of the Internal Revenue Code if it distributes at least 90% of its net investment income.
II. It may loan money for commercial construction projects.
III. It generates income by the spread between rental income, the combined mortgage interest, and operating expenses of the property.
IV. It is only suitable for an investor who is in a 28% or higher tax bracket, who has a net worth in excess of $200,000, or who is able to benefit from the flow through of losses.
A) I, II and III.
B) I, II and IV.
C) I and III.
D) II and III.
Answer: A) I, II and III.