Company: TDBCP
Filing Date: 2025-10-09
Form Type: 424B3
Source: 0001140361-25-037791
Chunk: 48

Company: TORONTO DOMINION BANK
Filing Date: 2025-10-09
Form: 424B3
Chunk 48
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 holder of an instrument, such as LIRNs, should be required to accrue ordinary income on a current basis, and they are seeking taxpayer comments on the subject. It is not possible to determine what guidance they will ultimately issue, if any. It is possible, however, that under such guidance, holders of LIRNs would ultimately be required to accrue current income and this could be applied on a retroactive basis. According to the Notice, the IRS and the Treasury are also considering other relevant issues, including whether gain or loss from such instruments should be treated as ordinary or capital, whether non-U.S. holders of such instruments should be subject to withholding tax on any deemed income accruals, and whether the special “constructive ownership rules” under Section 1260 of the Code should be applied to such instruments. Both U.S. and non-U.S. holders are urged to consult their tax advisors concerning the significance and potential impact of the above considerations on their investment in LIRNs. Except to the extent otherwise required by law or specified in the applicable term sheet, we intend to treat LIRNs for U.S. federal income tax purposes in accordance with the treatment described above unless and until such time as the Treasury and IRS determine that some other treatment is more appropriate. Section 1260 If LIRNs reference an Underlying Stock that is treated as equity in a RIC (or a “trust”), such as certain exchange-traded funds, a REIT, a PFIC, a partnership (including a master limited partnership), or other “pass-thru entity” for purposes of Section 1260 of the Code, it is possible that the “constructive ownership” rules of Section 1260 of the Code may apply, in which case the tax consequences of a taxable disposition (including cash settlement) of LIRNs could be materially and adversely affected. Under the “constructive ownership” rules, if an investment in LIRNs is treated as a “constructive ownership transaction”, any long-term capital gain recognized by a U.S. holder in respect of LIRNs will be recharacterized as ordinary income to the extent such gain exceeds the amount of “net underlying long-term capital gain” (as defined in Section 1260 of the Code) of the U.S. holder (the “ Excess Gain”). In addition, an interest charge would also apply to any deemed underpayment of tax in respect of any Excess Gain to the extent such gain would have resulted in a gross income inclusion for the U