Company: GNOLF
Filing Date: 2025-05-01
Form Type: 20-F/A
Source: 0001654954-25-004987
Chunk: 37

Company: GENOIL INC
Filing Date: 2025-05-01
Form: 20-F/A
Chunk 37
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 Credit

A U.S. Holder of Common Shares will generally be entitled to a foreign tax credit or deduction in an amount equal to the Canadian tax withheld. Dividends paid by Genoil generally will constitute foreign source dividend income and "passive income" for purposes of the foreign tax credit, which could reduce the amount of foreign tax credits available to shareholders. There are significant and complex limitations that apply to the credit.

Foreign Personal Holding Company Rules

Special U.S. tax rules apply to a shareholder of a foreign personal holding company ("FPHC"). Genoil would be classified as a FPHC in any taxable year if both of the following tests are satisfied:

| • | at least 60% of Genoil's gross income consists of "foreign personal holding company income", which generally includes passive income such as dividends, interest, royalties, gains from shares and commodity transactions and rents; and |

| • | more than 50% of the total voting power of all classes of voting shares or the total value of outstanding shares is owned directly or indirectly by five or fewer individuals who are U.S. citizens or residents. |

Passive Foreign Investment Company Rules

Special U.S. tax rules apply to a shareholder of a Passive Foreign Investment Company ("PFIC"). Genoil could be classified as a PFIC if, after the application of certain "look through" rules, for any taxable year, either:

| • | 75% or more of the Corporation's gross income for the taxable year is "passive income," which includes interest, dividends and certain rents and royalties; or |

| • | the average quarterly percentage, by fair market value of the Corporation's assets that produce or are held for the production of "passive income" is 50% or more of the fair market value of all of its assets. |

To the extent Genoil owns at least 25% by value of the shares of another corporation, it is treated for purposes of the PFIC tests as owning its proportionate share of the assets of such corporation, and as receiving directly its proportionate share of the income of such corporation.

Distributions which constitute "excess distributions" from a PFIC and dispositions of Common Shares of a PFIC are subject to the following special rules:

| • | the excess distributions (generally any distributions received by a U.S. Holder of Common Shares on the shares in any taxable year that are greater than 125% of the average annual distributions received by such U.S. Holder of Common Shares in the three preceding