Company: CLM
Filing Date: 2025-04-21
Form Type: 424B3
Source: 0001398344-25-007380
Chunk: 109

Company: Cornerstone Strategic Investment Fund, Inc.
Filing Date: 2025-04-21
Form: 424B3
Chunk 109
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 distributions.

Taxation of Distributions to U.S. Holders

Distributions from the Fund, except in the case of
distributions of qualified dividend income or capital gain dividends, as described below, generally will be taxable to U.S. Holders as
ordinary dividend income to the extent of the Fund’s current and accumulated earnings and profits. Distributions of net capital
gains (that is, the excess of net gains from the sale of capital assets held more than one year over net losses from the sale of capital
assets held for not more than one year) properly designated as capital gain dividends (“Capital Gain Dividends”) will be
taxable to U.S. Holders as long-term capital gain, regardless of how long a U.S. Holder has held the shares in the Fund. If a U.S. Holder’s
distributions are automatically reinvested pursuant to the Plan and the Plan Administrator invests the distribution in shares acquired
on behalf of the U.S. Holder in open-market purchases, for U.S. federal income tax purposes, the U.S. Holder will generally be treated
as having received a taxable distribution in the amount of the cash dividend that the U.S. Holder would have received if the U.S. Holder
had elected to receive cash. If a U.S. Holder’s distributions are automatically reinvested pursuant to the Plan and the Plan Administrator
invests the distribution in newly issued shares of the Fund, the U.S. Holder will generally be treated as receiving a taxable distribution
equal to the fair market value of the stock the U.S. Holder receives.

Under current law, certain income distributions paid
by the Fund to individual taxpayers are taxed at rates equal to those applicable to net long-term capital gains (generally, 20%). This
tax treatment applies only if certain holding period requirements and other requirements are satisfied by the U.S. Holder and the dividends
are attributable to qualified dividend income received by the Fund itself. For this purpose, “qualified dividend income”
means dividends received by the Fund from certain United States corporations (excluding REITs) and qualifying foreign corporations, provided
that the Fund satisfies certain holding period and other requirements in respect of the stock of such corporations. For these purposes,
a “qualified foreign corporation” means any foreign corporation if (i) such corporation is incorporated in a possession of
the United States, (ii) such corporation is eligible for benefits of a qualified comprehensive income tax treaty with the United States
and which includes an exchange of information program