The following information is being provided to assist U.S. individual Unitholders of Advantage Energy Income Fund (“Advantage” or the “Fund”) in reporting distributions received from Advantage during 2007 on their Internal Revenue Service ("IRS") Form 1040, “U.S. Individual Income Tax Return” ("Form 1040").

This summary is of a general nature only and is not intended to be legal or tax advice to any particular holder or potential holder of Advantage Trust Units. Holders or potential holders of Advantage Trust Units should consult their own legal and tax advisors as to their particular tax consequences of holding Advantage Trust Units. Advantage has not received an IRS letter ruling or a tax opinion from its tax advisors on these matters.

Qualified Dividends

In consultation with its U.S. tax advisors, Advantage believes that its Trust Units should be properly classified as equity in a corporation, rather than debt, and that dividends paid to individual U.S. Unitholders should be “qualified dividends” for U.S. federal income tax purposes.  As such, the portion of the distributions made during 2007 that are considered dividends for U.S. federal income tax purposes should qualify for the reduced rate of tax applicable to long-term capital gains.  However, the individual taxpayer’s situation must be considered before making this determination. 

Trust Units Held Outside a Qualified Retirement Plan

With respect to cash distributions paid during the year to U.S. individual Unitholders, 100% should be reported as “qualified dividends”. 

The portion of the distributions treated as “qualified dividends” should be reported on Line 9b of Form 1040, unless the fact situation of the U.S. individual Unitholder determines otherwise.  Commentary on page 19 of the Form 1040 Instruction Booklet for 2007 with respect to "qualified dividends" provides examples of individual situations where the dividends would not be “qualified dividends”. Where, due to individual situations, the dividends are not “qualified dividends”, the amount should be reported  on Schedule B – Part II – Ordinary Dividends and Line 9a of Form 1040.

For U.S. federal income tax purposes, in reporting a return of capital with respect to distributions received, U.S. Unitholders are required to reduce the cost base of their Trust Units by the total amount of distributions received that represent a return of capital.  This amount is non-taxable if it is a return of cost base in the Trust Units. If the full amount of the cost base has been recovered, any further return of capital distributions should be reported as capital gains.

U.S. Unitholders are encouraged to utilize the Qualified Dividends and Capital Gain Tax Worksheet of Form 1040 to determine the amount of tax that may be otherwise applicable.

The taxable portion (for Canadian income tax purposes) of the distributions is subject to a minimum 15% Canadian withholding tax that is withheld prior to any payments being distributed to Unitholders.  In 2007, the return of capital portion (for Canadian income tax purposes) of the distributions is also subject to a 15% withholding tax that is withheld prior to any payments being distributed to Unitholders.  Where Trust Units are held in a cash account, we believe the full amount of all withholding tax should be creditable, subject to numerous limitations, for U.S. tax purposes in the year in which the withholding taxes are withheld.  Where Trust Units are held in a qualified retirement account, the same withholding taxes apply but the amount is not creditable for U.S. tax purposes.

The amount of Canadian tax withheld should be reported on Form 1116, "Foreign Tax Credit (Individual, Estate, or Trust)".  Information regarding the amount of Canadian tax withheld in 2007 should be determined from your own records and is not available from Advantage.  Amounts over withheld, if any, from Canada should be claimed as a refund from the Canada Revenue Agency no later than two years after the calendar year in which the payment was paid.

Investors should report their dividend income and capital gain (if any), and make adjustments to their tax basis in Advantage’s Trust Units, in accordance with this information and subject to advice from their tax advisors.  U.S. individual Unitholders who hold their Advantage Trust Units through a stockbroker or other intermediary should receive tax reporting information from their stockbroker or other intermediary.  We expect that the stockbroker or other intermediary will issue a Form 1099-DIV, “Dividends and Distributions” or a substitute form developed by the stockbroker or other intermediary.  Advantage is not required to furnish such Unitholders with a Form 1099-DIV.  Information on the Form 1099-DIV issued by the brokers or other intermediaries may not accurately reflect the information in this press release for a variety of reasons.  Investors should consult their brokers and tax advisors to ensure that the information presented here is accurately reflected on their tax returns.  Brokers and/or intermediaries may or may not be required to issue an amended Form 1099-DIV.

Trust Units Held Within a Qualified Retirement Plan

No amounts are required to be reported on a Form 1040 where Advantage Trust Units are held within a qualified retirement plan.

Information Reporting; Backup Withholding Tax

Payments made within the United States, or by a U.S. payor or U.S. middleman, of dividends on, or proceeds arising from the sale or other taxable disposition of Advantage Trust Units generally will be subject to information reporting and backup withholding tax, currently at the rate of 28%, if a U.S. Unitholder (a) fails to furnish such U.S. Unitholder's correct U.S. taxpayer identification number (generally on Form W-9 ), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS that such U.S. Unitholder has previously failed to report properly items subject to backup withholding tax, or (d) fails to certify, under penalty of perjury, that such U.S. Unitholder has furnished its correct U.S. taxpayer identification number and that the IRS has not notified such U.S. Unitholder that it is subject to backup withholding tax. However, U.S. Unitholders that are corporations generally are excluded from these information reporting and backup withholding tax rules. Backup withholding is not an additional U.S. federal income tax. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a credit against a U.S. Unitholder's U.S. federal income tax liability, if any, or will be refunded to the extent it exceeds such liability, if such U.S. Unitholder furnishes required information to the IRS. A U.S. Unitholder that does not provide a correct U.S. taxpayer identification number may be subject to penalties imposed by the IRS. Each U.S. Unitholder should consult its own tax advisor regarding the information reporting and backup withholding tax rules.

For exemption from backup withholding tax (if applicable) please download Form W-9 from www.irs.gov and forward to the requester.