### Question
How is the term new capital defined?


### Answer
The term **new capital** is defined in *26 U.S.C. § 856* as the following:

> any amount received by the real estate investment trust—



(I) in exchange for stock (or certificates of beneficial interests) in such trust (other than amounts received pursuant to a dividend reinvestment plan), or



(II) in a public offering of debt obligations of such trust which have maturities of at least 5 years

#### Citation:
  - *26 U.S.C. § 856*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter M-Regulated Investment Companies and Real Estate Investment Trusts > PART II-REAL ESTATE INVESTMENT TRUSTS**

