Company: TEN-PE
Filing Date: 2025-04-11
Form Type: 20-F
Source: 0001193125-25-079101
Chunk: 182

Company: TSAKOS ENERGY NAVIGATION LTD
Filing Date: 2025-04-11
Form: 20-F
Item: Item 10
Chunk 182
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  Table of Contents      82  

Taxation in Absence of Exemption

To the extent the benefits of Section 883 are unavailable, our U. S.-source shipping income, to the extent not considered to be “effectively connected” with the conduct of a United States trade or business, as described below, would be subject to a 4% tax imposed by Section 887 of the Internal Revenue Code on a gross basis, without the benefit of deductions. Since under the sourcing rules described above, we do not expect that more than 50% of our shipping income would be treated as being derived from United States sources, the maximum effective rate of United States federal income tax on our shipping income would never exceed 2% under the 4% gross basis tax regime.

To the extent the benefits of the Section 883 exemption are unavailable and our U. S.-source shipping income or that of any of our subsidiaries is considered to be “effectively connected” with the conduct of a United States trade or business, as described below, any such “effectively connected” U. S.-source shipping income, net of applicable deductions, would be subject to the United States federal corporate income tax currently imposed at rates of up to 21%. In addition, we or our subsidiaries may be subject to the 30% “branch profits” taxes on earnings effectively connected with the conduct of such trade or business, as determined after allowance for certain adjustments, and on certain interest paid or deemed paid attributable to the conduct of its United States trade or business.

U. S.-source shipping income would be considered “effectively connected” with the conduct of a United States trade or business only if:

  We or one of our subsidiaries has, or is considered to have, a fixed place of business in the United States involved in the earning of shipping income; and  

  (i) in the case of shipping income other than that derived from bareboat charters, substantially all of our or such subsidiary’s U. S.-source shipping income is attributable to regularly schedu...  

We do not intend that we or any of our subsidiaries will have any vessel operating to the United States on a regularly scheduled basis. Based on the foregoing and on the expected mode of our shipping operations and other activities, we believe that none of the U. S.-source shipping income of us or our subsidiaries will be “effectively connected” with the conduct of a United States trade or business.

United States Taxation of Gain on Sale of Vessels

Regardless