Gabelli Utility Trust Maintains Consistent Monthly Distributions

Gabelli Utility Trust's Commitment to Monthly Distributions

Recently, the Board of Trustees of The Gabelli Utility Trust (NYSE: GUT) reaffirmed its dedication to providing shareholders with reliable cash distributions. The Fund announced a forthcoming distribution of $0.05 per share, planned for the months of July, August, and September.

Distribution Schedule Details

The important dates for these upcoming distributions have been set, reinforcing the Fund's established tradition of steady financial returns. Here’s a breakdown of the anticipated distribution schedule:

• July: Distributions will be recorded on July 17 and payable on July 24.
• August: Record date is on August 15 with payments due on August 22.
• September: Expected recording date is September 16, with payments to follow on September 23.

Review and Monitoring of Distributions

The Board of Trustees regularly evaluates the potential distribution amounts based on various factors, including income generated and net asset performance. They will continue to ensure that distributions align with the financial health of the Fund, taking into account market conditions.

Should it be necessary, the Fund may declare an adjusted distribution in December, which would include any surplus income and realized capital gains beyond the regular monthly distributions distributed throughout the year to satisfy tax regulations applicable to investment companies.

Understanding the Distribution Policy

Shareholders should be aware that while the Gabelli Utility Trust has maintained consistent monthly payouts since 1999, there's no guarantee that this practice will remain unchanged. The distribution rate should not be viewed as a measure of dividend yield or overall investment return.

As the shares are currently trading at a premium relative to their net asset value, the Board cautioned that this status may not be sustainable, particularly for those reinvesting distributions at these elevated prices.

Taxation and Distribution Components

Distributions may consist of various components, including long-term capital gains and qualified dividends. These components are treated differently for tax purposes, with long-term capital gains subject to federal income tax rates that currently sit at 20% for individuals, depending on their income level.

Additionally, certain individual and trust shareholders whose income surpasses specific thresholds may face a Medicare surcharge of 3.8% on their net investment income, which encompasses dividends from the Fund.

Return of Capital Considerations

If the Fund generates earnings falling short of total distributions in any given year, the excess amount distributed would generally be classified as a return of capital. This occurs when shareholders receive more than the actual earnings, likely resulting in a reduction of their cost basis rather than immediate tax consequences.

During 2025, it’s estimated that approximately 4% of distributions will derive from net investment income, with 1% from net capital gains and a significant 95% being classified as a return of capital.

Final Notes and Investor Relations

The estimates regarding distribution components are continuously updated and communicated to shareholders. This ensures transparency and aids stakeholders in understanding potential tax liabilities associated with their investments in the Fund.

For additional information on Gabelli Utility Trust’s distribution policy or other inquiries, interested parties should contact:

David Schachter
(914) 921-5057
dschachter@gabelli.com

About The Gabelli Utility Trust

The Gabelli Utility Trust stands as a closed-end management investment company with $321 million in assets, targeting long-term capital growth and income through investments in utility firms devoted to electricity, gas, and water services. The Fund is overseen by Gabelli Funds, LLC, part of GAMCO Investors, Inc. (OTCQX: GAMI).

Frequently Asked Questions

What is the recent distribution amount declared by Gabelli Utility Trust?

The Gabelli Utility Trust declared a distribution of $0.05 per share for July, August, and September.

When are the distributions payable?

The distributions are payable on July 24, August 22, and September 23, respectively.

How does the Fund manage its distribution policy?

The Board of Trustees reviews potential distributions quarterly, considering income generated, capital gains, and market conditions.

What happens if the Fund’s earnings are insufficient?

If the Fund does not earn enough to cover its distributions, the excess will be treated as a return of capital for shareholders.

How can investors contact Gabelli Utility Trust for more information?

Investors can reach out to David Schachter at (914) 921-5057 or via email at dschachter@gabelli.com for any inquiries.

About The Author

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