Company: SRV
Filing Date: 2025-04-10
Form Type: N-2
Source: 0001398344-25-006954
Chunk: 70

Company: NXG Cushing Midstream Energy Fund
Filing Date: 2025-04-10
Form: N-2
Chunk 70
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. shareholders) (i) for the
dividends received deduction in the case of corporate U.S. shareholders to the extent that the Fund’s income consists of dividend
income from U.S. corporations or (ii) in the case of individual U.S. shareholders, as qualified dividend income eligible to be taxed at
a reduced maximum rate to the extent that the Fund receives qualified dividend income. Qualified dividend income is, in general, dividend
income from taxable domestic corporations and certain foreign corporations. There can be no assurance as to what portion of the Fund’s
distributions will qualify for the dividends received deduction or for treatment as qualified dividend income.

Distributions made from net capital
gain, which is the excess of net long-term capital gains over net short-term capital losses (“capital gain dividends”), including
capital gain dividends credited to a U.S. shareholder but retained by the Fund, are taxable to U.S. shareholder as long-term capital gains
if they have been properly reported by the Fund, regardless of the length of time the U.S. shareholder has owned Common Shares of the
Fund. Net long-term capital gain of individuals is generally taxed at a reduced maximum rate. For corporate taxpayers, net long-term capital
gain is taxed at ordinary income rates.

Subject to any future regulatory
guidance to the contrary, any distribution of income attributable to income from the Fund’s investment in an MLP will not qualify
for the 20% deduction for “qualified PTP income” that would generally be available to a non-corporate U.S. shareholder were
the shareholder to own such MLP directly. As a result, it is possible that a non-corporate U.S. shareholder will be subject to a higher
effective tax rate on any such distributions received from the Fund compared to the effective rate applicable to any income the U.S. shareholder
would receive if the shareholder invested directly in an MLP.

If, for any calendar year, the
Fund’s total distributions exceed both current earnings and profits and accumulated earnings and profits, the excess will generally
be treated as a tax-free return of capital up to the amount of a U.S. shareholder’s tax basis in the Common Shares, reducing that
basis accordingly. Such distributions exceeding the U.S. shareholder’s basis will be treated as gain from the sale or exchange of
the Common Shares. When you sell your Common Shares, the amount, if any, by which your sales price exceeds your basis in the Fund’s
Common Shares is gain subject to tax. Because a return of