Company: FMST
Filing Date: 2025-06-20
Form Type: 20-F
Source: 0001171843-25-004004
Chunk: 174

Company: Foremost Clean Energy Ltd.
Filing Date: 2025-06-20
Form: 20-F
Item: Item 10
Chunk 174
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 A U. S. Holder will have a tax basis in the foreign currency equal to its U. S. dollar value on the date of receipt. Any U. S. Holder who converts or otherwise disposes of the foreign currency after the date of receipt may have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U. S. source income or loss for foreign tax credit purposes. Different rules apply to U. S. Holders who use the accrual method of tax accounting. Each U. S. Holder should consult its own U. S. tax advisors regarding the U. S. federal income tax consequences of receiving, owning, and disposing of foreign currency.

Foreign Tax Credit

Dividends paid on the common shares will be treated as foreign-source income, and generally will be treated as “passive category income” or “general category income” for U. S. foreign tax credit purposes. Any gain or loss recognized on a sale or other disposition of common shares generally will be United States source gain or loss. Certain U. S. Holders that are eligible for the benefits of Canada-U. S. Tax Treaty may elect to treat such gain or loss as Canadian source gain or loss for U. S. foreign tax credit purposes. The Code applies various complex limitations on the amount of foreign taxes that may be claimed as a credit by U. S. taxpayers. In addition, Treasury Regulations that apply to foreign taxes paid or accrued (the “ Foreign Tax Credit Regulations”) impose additional requirements for Canadian withholding taxes to be eligible for a foreign tax credit, and there can be no assurance that those requirements will be satisfied. The Treasury Department has recently released guidance temporarily pausing the application of certain of the Foreign Tax Credit Regulations.

131

Subject to the PFIC rules and the Foreign Tax Credit Regulations, each as discussed above, a U. S. Holder that pays (whether directly or through withholding) Canadian income tax with respect to dividends paid on the common shares generally will be entitled, at the election of such U. S. Holder, to receive either a deduction or a credit for such Canadian income tax. Generally, a credit will reduce a U. S. Holder's U. S. federal income tax liability on a dollar-for-dollar basis, whereas a deduction will reduce a U. S. Holder's income that is subject to U. S. federal income tax. This election is made on a year-by-year basis and applies to all foreign taxes paid (whether directly or through withholding