Company: BPYPN
Filing Date: 2025-03-21
Form Type: 20-F
Source: 0001545772-25-000008
Chunk: 185

Company: Brookfield Property Partners L.P.
Filing Date: 2025-03-21
Form: 20-F
Item: Item 10
Chunk 185
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 rules. Consistent with BPY’s position, BPY does not anticipate allocating to a U. S. Holder any ordinary earnings or net capital gain attributable to any subsidiary PFIC with respect to which a “qualified electing fund” election (“ QEF Election”) has been made, if such U. S. Holder’s interest in such PFIC arises solely by reason of owning Preferred Units. Nor does BPY currently anticipate allocating any gain from the disposition (including a deemed disposition) of stock of a subsidiary PFIC to such U. S. Holder, regardless whether any QEF Election has been made with respect to such PFIC.

However, the treatment of preferred partnership interests under the PFIC rules and the application of the PFIC rules to U. S. Holders are uncertain in certain respects. There can be no assurance that the IRS or a court will not treat a U. S. Holder as subject to the PFIC rules that apply to U. S. persons holding partnership interests in BPY generally. In such case, a U. S. Holder’s ownership of Preferred Units may produce taxable income that is not related to distributions on the Preferred Units, such as income realized on excess distributions by a PFIC or gain from the disposition of stock of a PFIC. Such U. S. Holder may be required to take such income into account in determining the holder’s gross income subject to tax. With respect to gain realized upon the sale of and excess distributions from a PFIC for which a QEF Election for current inclusions is not made,

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such income would be taxable at ordinary income rates and subject to an additional tax equivalent to an interest charge on the deferral of income inclusions from the PFIC, unless the U. S. Holder had made a timely and effective election to “mark to market” the stock of such PFIC on an annual basis (a “ Mark-to-Market Election”). However, the Mark-to-Market Election is available only for “marketable stock,” which is stock regularly traded on certain qualified exchanges, and therefore the Mark-to-Market Election generally is not expected to be available with respect to any PFIC in which a U. S. Holder is treated as owning an indirect interest through BPY. U. S. Holders of Preferred Units of BPY should consult their own tax advisers regarding the application of the PFIC rules to their ownership of Preferred Units in light of their particular circumstances.

Controlled Foreign Corporation Considerations for U. S. Holders of Preferred Units