Company: DEFI
Filing Date: 2025-11-04
Form Type: POS AM
Source: 0001999371-25-016766
Chunk: 153

Company: Tidal Commodities Trust I
Filing Date: 2025-11-04
Form: POS AM
Chunk 153
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 Shareholders may not be able to offset losses from one activity against income from another. Under Treasury Regulations, however, income derived from certain pass-through entities and all debt-financed income that is not otherwise attributable to a trade or business are treated as arising from a single trade or business for purposes of the foregoing rule, subject to certain requirements. An exempt organization Shareholder will be required to make payments of estimated U.S. federal income tax with respect to its UBTI. Regulated Investment Companies.Interests in and income from “qualified publicly traded partnerships” satisfying certain gross income tests are treated as qualifying assets and income, respectively, for purposes of determining eligibility for regulated investment company (“RIC”) status. A RIC may invest up to 25% of its assets in interests in qualified publicly traded partnerships. The determination of whether a publicly traded partnership, such as the Fund, is a qualified publicly traded partnership is made on an annual basis. While the tax treatment of bitcoin derivatives is not entirely clear, it is possible that the Fund may be a qualified publicly traded partnership. However, such qualification is not assured, and prospective RIC investors should consult a tax advisor regarding the treatment of an investment in the Fund under current tax rules and in light of their particular circumstances. Non-U.S. Shareholders Subject to the discussion below concerning FATCA (as defined below), generally, non-U.S. persons who derive U.S. source income or gain from investing or engaging in a U.S. business are taxable on two categories of income. The first category consists of amounts that are fixed or determinable, annual or periodical income, such as interest, dividends and rent that are not connected with the operation of a U.S. trade or business (“FDAP”). The second category is income that is effectively connected with the conduct of a U.S. trade or business (“ECI”). FDAP income (other than interest that is considered “portfolio interest;” as discussed below) is generally subject to a 30% withholding tax, which may be reduced for certain categories of income by a treaty between the U.S. and the recipient’s country of residence. In contrast, ECI is generally subject to U.S. tax on a net basis at graduated rates and requires the filing of a U.S. tax return. 125 Withholding on Allocations and Distributions.The Code provides that if a partnership is engaged in a U.S. trade or business during a taxable year, a Non-U.S. Shareholder who is a partner in the partnership will also be considered