The information contained herein is of a general nature only and not
exhaustive of all possible U.S. tax considerations. It is not intended to
constitute legal or tax advice to any holder or potential holder of Clean
Power Income Fund trust units.
TORONTO, March 28 /CNW/ - Clean Power Income Fund (the "Fund") believes
that the Fund should be considered a qualified foreign corporation and that
dividends (as computer under U.S. tax principles) paid to its individual U.S.
unitholders should be considered "qualified dividends" under the Jobs and
Growth Tax Relief Reconciliation Act of 2003 for U.S. federal income tax
purposes. The Fund's traded units more likely than not are properly classified
as equity in a corporation, rather than as debt, for U.S. federal income tax
purposes. As such, the portion of the distributions made during 2006 that are
considered qualified dividends should be eligible for the reduced rate of tax
applicable to certain long-term capital gains.
The portion of the Fund's distributions that is considered a dividend for
U.S. income tax purposes is determined based upon the greater of the Fund's
current or accumulated earnings & profits ("E&P") as determined in accordance
with U.S. income tax law.
With respect to cash distributions paid in 2006 to U.S. individual
unitholders, 57.02 percent (2005 - 30.17 percent) should be reported as a
non-taxable return of capital (to the extent of the unitholder's U.S. tax
basis in the units. Where unitholders do not have U.S. tax basis in the units,
the portion of the distribution that does not represent qualified dividends
should be taxable as capital gain for U.S. Federal income tax purposes) and
42.98 percent (2005 - 69.83 percent) should be reported as qualified
The Fund is not required to issue Form 1099 DIVs; however, U.S.
unitholders may have previously received a Form 1099 DIV from a broker or
intermediary that may not be correct. As a result of this, U.S. unitholders
should consult their brokers and tax advisors to ensure that this information
is accurately reflected on their tax returns. Brokers and/or intermediaries
may or may not be required to issue amended Form 1099 DIVs.
Canadian resident taxpayers should note that the above information has no
impact on the previously disclosed Canadian tax information. For Canadian tax
purposes, cash distributions declared in 2006 are classified 87.85 percent as
a return of capital and 12.15 percent as income (2005 - 59.99 percent and
40.01 percent, respectively).
ABOUT CLEAN POWER INCOME FUND
Clean Power Income Fund is an open-ended investment trust that is
invested in 15 power generating facilities located in Québec, Ontario,
Alberta, British Columbia and four U.S. states with a total capacity of
303 MW. Three environmentally preferred technologies - windpower, waterpower
and biomass - deliver electricity almost exclusively under long-term sales
contracts and at minimal to zero fuel cost.
Clean Power Income Fund is the first income fund to be certified under
the Government of Canada's Environmental ChoiceM Program. Clean Power Income
Fund's units and convertible debentures are listed and posted for trading on
the Toronto Stock Exchange under the symbols "CLE.UN" and "CLE.DB",
More information about Clean Power Income Fund can be found at
Forward Looking Statements
This press release may contain forward-looking statements within the
meaning of applicable securities legislation. Any statements that express or
involve discussions with respect to the Fund's expectations, beliefs,
intentions, future events or performance (often using words such as
"believes", "expects", "anticipates" or "intends" or stating that certain
actions, events or results "may", "could", "would", "might" or "will" be taken
or achieved) are not statements of historical fact, but are forward-looking
statements. Such forward-looking statements, by their nature, necessarily
involve known and unknown risks, uncertainties and other factors beyond the
Fund's ability to control or predict, that may cause the Fund's actual
results, performance or achievements to differ materially from the anticipated
results, performance or achievements expressed or implied by such
forward-looking statements. Investors and others should not place undue
reliance on these forward-looking statements as actual results could differ
materially from the forward-looking statements in this press release based on
risks associated with the unitholder value enhancement opportunities involving
third parties and other factors over which the Fund has no control including
the risks detailed from time to time in the documents filed by the Fund with
securities regulators. The Fund does not undertake or assume any obligation to
publicly update or revise any forward-looking statement, whether as a result
of new information, future events or any other reason.
For further information:
For further information: Rob A. Roberti, Chief Financial Officer, Clean
Power Operating Trust, (416) 777-2800 ext. 259, firstname.lastname@example.org,