Tax Info for U.S. Investors

Effective January 1, 2011, Enerplus Resources Fund converted to Enerplus Corporation. This conversion was a tax deferred transaction for U.S. individual investors. Enerplus Corporation shares are eligible investments for IRAs and are not considered UBTI. Even prior to the conversion Enerplus has always been treated as a corporation for US tax purposes.

In 2011, monthly payments made by Enerplus Corproration were 100% comprised of taxable dividends, which includes both cash dividends and DRIP dividends. For 2011, our dividends to U.S. individual residents continue to be "qualified dividends" eligible for the reduced tax rate. Taxable dividend amounts will be communicated to shareholders via a Form 1099 DIV prepared by their brokers. 

Dividends

For 2011, if Enerplus shares are held in a taxable U.S. account, the dividend is subject to a minimum 15% Canadian withholding tax that is withheld prior to any monies being paid to shareholders. U.S. investors may be able to receive a foreign tax credit with respect to this withholding tax. Where shares are held in an IRA, withholding tax should no longer apply.

Investors are required to reduce the cost base of their holdings by the amount of the non-taxable return of capital paid up to December 31, 2010. No reduction is required for 2011 as no distribution was a non-taxable return of capital payment.

Enerplus offers a cost basis calculator to assist investors with their basis calculation. To the extent an investor's basis is reduced below zero, any future non-taxable return of capital payments will be deemed to be a capital gain and the investor's basis will become zero.

Shareholders are advised to consult their tax advisors regarding questions relating to the tax treatment of Enerplus dividends and the computation of the cost basis of their investment in Enerplus.

Archived Tax Letters for Enerplus Resources Fund