Investors: 

• Canopy is in the process of reviewing & preparing the 2022 tax returns and we expect to distribute K-1s towards the end of summer. 
• In order for Canopy to prepare the necessary tax reporting, we must receive the necessary information from the Syndicate Leads regarding the underlying portfolio companies. For this reason, each individual LP may receive their tax reporting at different times. 
• Most investors expecting K-1s from other (Non-Canopy) private investments will generally file an extension of their own personal returns, since K-1s are typically distributed after the tax deadline. However, based on our estimates, we don't expect the Canopy K-1s for 2022 to contain material amounts of taxable income.   
• The way you use tax estimates provided to you is up to you and your tax advisor.  Most investors take one of two approaches:
  • Approach 1: Use the taxable income estimates to make estimated tax payments prior to filing their final tax return.
  • Approach 2: Use the estimate in place of the actual K-1 and include the estimate in filing their tax return. If the final K-1 received is materially different from the estimate, investors typically either amend the filed return or include the difference in the following year’s tax return.

Syndicate Leads: 

• Canopy does not prepare the tax return for the Manager or any other carry recipient vehicles managed by a Syndicate Lead.  Canopy only prepares tax returns (Form 1065) and the accompanying schedule K-1s for Canopy SPVs. Managers will receive schedule K-1s from the Canopy SPVs under their management.  We expect that Managers will have a tax reporting obligation each year it receives management fees and/or carried interest.   We recommend that Syndicate Leads speak to their own tax advisor regarding the tax reporting obligations of the Manager.

• Generally, Syndicate Leads that are sole members of their Manager will not need to file a separate tax return for the Manager. We would expect any management fee income to be reported directly on the Syndicate Lead’s personal tax return.

• Canopy is not a tax advisor and we recommend Syndicate Leads consult with their own tax advisors with respect to individual tax circumstances.