MSC Income currently accrues and pays regular quarterly dividends to its stockholders and expects to periodically accrue and pay supplemental quarterly dividends to its stockholders. Future dividends, if any, will be determined by its Board of Directors on a quarterly basis.


	Three Months Ended March 31,
	2025		2024
	(in thousands, except per share amounts)
Regular quarterly dividends per share	$	0.35	$	0.37
Supplemental quarterly dividends per share	0.01		—
Total dividends per share	$	0.36	$	0.37

Total regular quarterly dividends accrued	$	16,397	$	14,821
Total supplemental quarterly dividends accrued	468		—
Total dividends accrued	$	16,866	$	14,821

MSIF has elected to be treated for U.S. federal income tax purposes as a RIC. MSIF’s taxable income includes the taxable income generated by MSIF and certain of its subsidiaries, including the Structured Subsidiaries, which are treated as disregarded entities for tax purposes. As a RIC, MSIF generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that MSIF distributes to its stockholders. MSIF must generally distribute at least 90% of its “investment company taxable income” (which is generally its net ordinary taxable income and realized net short-term capital gains in excess of realized net long-term capital losses) and 90% of its tax-exempt income to maintain its RIC status (pass-through tax treatment for amounts distributed). As part of maintaining RIC status, undistributed taxable income (subject to a 4% non-deductible U.S. federal excise tax) pertaining to a given fiscal year may be distributed up to twelve months subsequent to the end of that fiscal year, provided such dividends are declared on or prior to the later of (i) filing of the U.S. federal income tax return for the applicable fiscal year or (ii) the fifteenth day of the ninth month following the close of the year in which such taxable income was generated.

The determination of the tax attributes for MSC Income’s distributions is made annually, based upon its taxable income for the full year and distributions paid for the full year. Therefore, a determination made on an interim basis may not be representative of the actual tax attributes of distributions for a full year. Ordinary dividend distributions from a RIC do not qualify for the 20% maximum tax rate (plus a 3.8% Medicare surtax, if applicable) on dividend income from domestic corporations and qualified foreign corporations, except to the extent that the RIC received the income in the form of qualifying dividends from domestic corporations and qualified foreign corporations. The tax attributes for distributions will generally include both ordinary income and qualified dividends, but may also include either one or both of capital gains and return of capital.


	Three Months Ended March 31,
	2025		2024
	(estimated, in thousands)
Net increase in net assets resulting from operations	$	15,875	$	10,589
Net unrealized (appreciation) depreciation	(18,783)		1,133
Income tax provision (benefit)	(1,370)		940
Pre-tax book (income) loss not consolidated for tax purposes	275		(1,261)
Book income and tax income differences, including debt origination, structuring fees, dividends, realized gains and changes in estimates	19,424		1,481
Estimated taxable income (1)	15,421		12,882
Taxable income earned in prior year and carried forward for distribution in current year	20,348		14,745
Taxable income earned prior to period end and carried forward for distribution next period	(35,769)		(27,627)
Dividend payable as of period end and paid in the following period	16,866		14,821
Total distributions accrued or paid to common stockholders	$	16,866	$	14,821

________________

(1)MSIF’s taxable income for each period is an estimate and will not be finally determined until MSIF files its tax return for each year. Therefore, the final taxable income, and the taxable income earned in each period and carried forward for distribution in the following period, may be different than this estimate.

The Taxable Subsidiaries primarily hold certain equity investments for MSC Income. The Taxable Subsidiaries permit MSC Income to hold equity investments in portfolio companies which are “pass-through” entities for tax purposes and to continue to comply with the “source-of-income” requirements contained in the RIC tax provisions of the Code. The Taxable Subsidiaries are consolidated with MSIF for U.S. GAAP financial reporting purposes, and the portfolio investments held by the Taxable Subsidiaries are included in MSC Income’s consolidated financial statements as portfolio investments and recorded at fair value. The Taxable Subsidiaries are not consolidated with MSIF for income tax purposes and may generate income tax expense, or benefit, and tax assets and liabilities, as a result of their ownership of certain portfolio investments. The taxable income, or loss, of the Taxable Subsidiaries may differ from their book income, or loss, due to temporary book and tax timing differences and permanent differences. The Taxable Subsidiaries are each taxed at corporate income tax rates based on their taxable income. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the Taxable Subsidiaries are reflected in MSC Income’s consolidated financial statements.

The income tax provision for MSC Income is generally composed of (i) deferred tax expense (benefit), which is primarily the result of the net activity relating to the portfolio investments held in the Taxable Subsidiaries, including changes in loss carryforwards, changes in net unrealized appreciation or depreciation and other temporary book tax differences, and (ii) current tax expense, which is primarily the result of current U.S. federal income and state taxes and excise taxes on MSC Income’s estimated undistributed taxable income. The income tax expense, or benefit, and the related tax assets and liabilities generated by the Taxable Subsidiaries, if any, are reflected in MSC Income’s Consolidated Statements of Operations. MSC Income’s provision for income taxes was comprised of the following for the three months ended March 31, 2025 and 2024:


	Three Months Ended March 31,
	2025		2024
	(dollars in thousands)
Current tax expense:
Federal	$	53	$	53
State	238		200
Excise	192		76
Total current tax expense	483		329
Deferred tax expense (benefit):
Federal	(1,613)		656
State	(240)		(45)
Total deferred tax expense (benefit)	(1,853)		611

Total income tax provision (benefit)	$	(1,370)	$	940

The net deferred tax asset as of March 31, 2025 and December 31, 2024 was $2.5 million and $0.6 million, respectively, with the change primarily related to changes in net unrealized appreciation or depreciation, changes in loss carryforwards and other temporary book-tax differences relating to portfolio investments held by the Taxable Subsidiaries.