What tax considerations should investors be aware of when receiving this quarterly dividend?

Tax considerations for the $0.40 PATK quarterly dividend

1. Ordinary‑income treatment – The $0.40 per share is a cash dividend on common stock, so the IRS (and most foreign tax authorities) treats it as qualified ordinary dividend income. For U.S. investors it is taxed at the qualified‑dividend rate (0 %–20 % depending on your marginal tax bracket) rather than at the higher ordinary‑income rates that apply to non‑qualified dividends. If you hold the shares in a non‑qualified account (e.g., a regular brokerage account), you must report the dividend on Form 1040, Schedule B, and indicate that it is qualified.

2. Holding‑period requirement – To be eligible for the reduced qualified‑dividend rate, you must have held the PATK shares for more than 60 days during the 121‑day period that begins 60 days before the ex‑dividend date. If you buy the stock just to capture the dividend and sell before the 60‑day holding window, the dividend will be taxed at your ordinary income rate.

3. State and foreign tax implications – Most states tax dividend income as ordinary income, so the same qualified‑dividend rate applies on the state return where allowed. Non‑U.S. investors should check local tax treaties; many jurisdictions treat U.S. cash dividends as ordinary income and may credit foreign taxes paid.

4. Tax‑loss harvesting and portfolio rebalancing – If you have realized capital losses in the same tax year, you can offset up to $3,000 of dividend income (or $1,500 for married filing separately) against ordinary income. Conversely, if the dividend pushes you into a higher marginal bracket, consider harvesting additional losses or deferring other income to keep your effective tax rate in check.

Actionable trading insight

Because the dividend is modest and the qualified‑dividend tax rate is generally low, the after‑tax yield remains attractive for income‑focused investors who can meet the 60‑day holding requirement. However, speculative “dividend‑capture” trades that breach the holding period will erode the tax advantage and may trigger higher tax liabilities. Combine the dividend with PAT Inc.’s recent fundamentals—steady earnings growth, a 5‑year dividend‑payout ratio around 45 % and a price‑to‑earnings multiple near the sector median—to confirm that the stock’s price support is solid. Technically, the shares have been holding above the 50‑day moving average with a bullish MACD, suggesting limited downside risk. Recommendation: If you already own PATK, retain the position through the ex‑dividend date to capture the qualified dividend; if you’re a short‑term trader, avoid buying solely for the dividend unless you can comfortably hold for ≥60 days and have sufficient tax‑loss carryforwards to offset the ordinary‑income portion.