Assume a building, owned by a REIT, increases in value and the REIT that owns it sells the building for $120 million and then makes a capital gain distribution to its shareholders. Which of the following is true regarding

A U.S. individual investor's tax treatment:

1. The gain on the sale will be taxed at the ordinary income tax rate.
2. The gain on the sale will be taxed at the capital gain tax rate.
3. There is no tax on the net gain at the shareholder level.
4. None of the above.

A tax-exempt investor's tax treatment:

1. The gain on the sale will be taxed at the ordinary income tax rate.
2. The gain on the sale will be taxed at the capital gain tax rate.
3. There is no tax on the net gain at the shareholder level.
4. None of the above.

A non-US investor's tax treatment:

1. The gain on the sale will be taxed at the ordinary income tax rate.
2. The gain on the sale will be taxed at the capital gain tax rate.
3. There is no tax on the net gain at the shareholder level.
4. None of the above.