Form 497 Leader Funds Trust
News and research before you hear about it on CNBC and others. Claim your 1-week free trial to StreetInsider Premium here.
Leader Short Term High Yield Bond Fund
Institutional Shares: LCCIX
Investor Shares: LCCMX
Leader High Quality Floating Rate Fund
Institutional Shares: LCTIX
Investor Shares: LCTRX
Supplement dated February 3, 2023
Prospectus dated September 30, 2022, as amended
The following provides new information about the Funds’ ordinary investment income (as defined below) distribution policy contained in the current Prospectus. Effective immediately, the Leader High Quality Floating Rate Fund (the “High Quality Fund”) will declare ordinary investment income daily and pay them monthly; the Leader Short Term High Yield Bond Fund will continue to declare and pay ordinary investment income monthly. Please read it carefully along with the Fund’s Prospectus and SAI.
Changes to the Prospectus
The following replaces the information under the heading “Tax Status, Dividends, and Distributions” on page 26 of the Prospectus:
TAX STATUS, DIVIDENDS, AND DISTRIBUTIONS
Any sale or exchange of a Fund’s shares may generate tax liability (unless you are a tax-exempt investor or your investment is in a qualified retirement account). When you redeem your shares you will generally realize a taxable gain or loss. This is measured by the difference between the proceeds of the sale and the tax basis for the shares you sold. (To aid in computing your tax basis, you generally should retain your account statements for the period that you hold shares in the Fund.)
The High Yield Fund will declare and pay its income from dividends, interest, and other payments *(collectively, ordinary investment income”) monthly. The High Quality Fund will declare its ordinary investment income daily and pay it monthly. Each Fund intends to distribute all or substantially all of its short and long-term net capital gains annually, at such time as the Board determines in its sole discretion. Both ordinary investment income and capital gain distributions will be reinvested in shares of the Fund unless you elect to receive cash. Dividends from ordinary investment income (including any excess of net short-term capital gain over net long-term capital loss) are taxable to investors as ordinary income, while distributions of net capital gain (the excess of net long-term capital gain over net short-term capital loss) are generally taxable as long-term capital gain, regardless of your holding period for the shares. Any dividends or capital gain distributions you receive from a Fund will normally be taxable to you when made, regardless of whether you reinvest dividends or capital gain distributions or receive them in cash. Each year each Fund will inform you of the amount and type of your distributions. IRAs and other qualified retirement plans are exempt from federal income taxation until retirement proceeds are paid out to the participant.
Your redemptions, including exchanges, will generally result in a capital gain or loss for federal tax purposes. A capital gain or loss on your investment is the difference between the tax basis (generally the cost) of your shares, including any sales charges, and the amount you receive when you sell them.
On the account application, you will be asked to certify that your social security number or taxpayer identification number is correct and that you are not subject to backup withholding for failing to report income to the IRS. If you are subject to backup withholding or you did not certify your taxpayer identification number, the IRS requires a Fund to withhold a percentage of any dividend, redemption, or exchange proceeds. Each Fund reserves the right to reject any application that does not include a certified social security or taxpayer identification number. If you do not have a social security number, you should indicate on the purchase form that your application to obtain a number is pending. Each Fund is required to withhold taxes if a number is not delivered to the Fund within seven days.
Fund distributions and gains from the sale or exchange of your shares will generally be subject to state and local income tax. Non-U.S. investors may be subject to U.S. withholding and estate tax. You should consult with your tax adviser about the federal, state, local or foreign tax consequences of your investment in the Fund.
Federal law requires that mutual fund companies report their shareholders’ cost basis, gain/loss, and holding period to the IRS on each Fund’s shareholders’ Consolidated Form 1099s when “covered” securities are sold. Covered securities are any regulated investment company and/or dividend reinvestment plan shares acquired on or after January 1, 2012. Each Fund has chosen average cost as its standing (default) tax lot identification method for all shareholders. A tax lot identification method is the way a Fund will determine which specific shares are deemed to be sold when there are multiple purchases on different dates at differing NAVs, and the entire position is not sold at one time. A Fund’s standing tax lot identification method is the method covered shares will be reported on your Consolidated Form 1099 if you do not select a specific tax lot identification method. You may choose a method different than the Fund’s standing method and will be able to do so at the time of your purchase or upon the sale of covered shares. Please refer to the appropriate Internal Revenue Service regulations or consult your tax advisor with regard to your personal circumstances.
Cost Basis Reporting. For those securities defined as “covered” under current IRS cost basis tax reporting regulations, a Fund is responsible for maintaining accurate cost basis and tax lot information for tax reporting purposes. The Funds have chosen Average Cost as its default tax lot identification method for all shareholders. A tax lot identification method is the way the Fund will determine which specific shares are deemed to be sold when there are multiple purchases on different dates at differing net asset values, and the entire position is not sold at one time. A Fund’s standing tax lot identification method is the method covered shares will be reported on your Consolidated Form 1099 if you do not select a specific tax lot identification method. You may choose a method different than a Fund’s standing method and will be able to do so at the time of your purchase or upon the sale of covered shares. Please refer to the appropriate Internal Revenue Service regulations or consult your tax adviser with regard to your personal circumstances.
A Fund and its service providers do not provide tax advice. You should consult independent sources, which may include a tax professional, with respect to any decisions you may make with respect to choosing a tax lot identification method.
This summary is not intended to be and should not be construed to be legal or tax advice. You should consult your own tax advisors to determine the tax consequences of owning the Funds’ shares.
You should read this Supplement in conjunction with the Prospectus and SAI dated September 30, 2022, each as may be amended from time to time, which provide information that you should know about the Fund before investing. These documents are available upon request and without charge by calling the Fund at (800) 711-9164.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
- Wall St ends higher as Yellen vows actions to safeguard deposits
- Wall Street digests Powell's comments on banks, rate cuts and inflation
- PacWest says it would not be 'prudent' to go ahead with capital raise; Analyst optimistic
- Block (SQ) shares plunge after Hindenburg claims it misleads investors with 'inflated metrics'
- Coinbase Wells Notice: Oppenheimer cuts; Mizuho says a third of revenue could be affected
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Alpine Immune Sciences Provides Corporate Update and Reports Fourth Quarter and Full Year 2022 Financial Results
- Torrid Reports Fourth Quarter and Fiscal 2022 Results
- Ouster Achieves 2022 Guidance, Reporting 22% Full Year Revenue Growth
Create E-mail Alert Related CategoriesSEC Filings
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!