Company: DEFI
Filing Date: 2025-03-25
Form Type: POS AM
Source: 0001999371-25-003118
Chunk: 199

Company: Tidal Commodities Trust I
Filing Date: 2025-03-25
Form: POS AM
Chunk 199
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 sold. If a Shareholder who has differing holding periods for its Shares fails to make the election or is not able to identify the holding periods of the Shares sold, the Shareholder will have a split holding period in the Shares sold. Under such circumstances, a Shareholder will be required to determine its holding period in the Shares sold by first determining the portion of its entire interest in the Fund that would give rise to long-term capital gain or loss if its entire interest were sold and the portion that would give rise to short-term capital gain or loss if the entire interest were sold. The Shareholder would then treat each Share sold as giving rise to long-term capital gain or loss and short-term capital gain or loss in the same proportions as if it had sold its entire interest in the Fund.

Under Section 751 of the Code, a portion of a Shareholder’s gain or loss from the sale of Shares (regardless of the holding period for such Shares), will be separately computed and taxed as ordinary income or loss to the extent attributable to “unrealized receivables” or “inventory” owned by the Fund. The term “unrealized receivables” includes, among other things, market discount bonds and short-term debt instruments to the extent such items would give rise to ordinary income if sold by the Fund. However, the short-term capital gain on section 1256 contracts resulting from 60-40 treatment, described above, should not be subject to this rule.

If some or all of a Shareholder’s Shares are lent by its broker or other agent to a third party — for example, for use by the third party in covering a short sale — the Shareholder may be considered as having made a taxable disposition of the loaned Shares, in which case:

| ● | the                                                                                     
 Shareholder may recognize taxable gain or loss to the same extent as if it had sold the 
 Shares for cash;                                                                        |

| ● | any                                                                                     
 of the income, gain, loss or deduction allocable to those Shares during the period of   
 the loan is not reportable by the Shareholder for U.S. federal income tax purposes; and |

| ● | any                                                                                        
 distributions the Shareholder receives with respect to the Shares under the loan agreement 
 will be fully taxable to the Shareholder, most likely as ordinary income for U.S. federal  
 income tax purposes.                                                                       |

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Shareholders desiring to avoid these and other possible consequences of a deemed disposition of their Shares should consider modifying