SEC Form N-CSR filed by DTF Tax-Free Income 2028 Term Fund Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-06416

DTF Tax-Free Income 2028 Term Fund Inc.

(Exact name of registrant as specified in charter)

10 South Wacker Drive, Suite 1900, Chicago, Illinois 60606

(Address of principal executive offices) (Zip code)

(Name and address of agents for service)

Registrant’s telephone number, including area code: (312) 368-5510

Date of fiscal year end: October 31

Date of reporting period: October 31, 2024

LETTER TO

SHAREHOLDERS

December 13, 2024

IMPORTANT INFORMATION ABOUT YOUR FUND

FUND DIVIDEND

As of October 31, 2024, DTF Tax-Free Income 2028 Term Fund Inc. (the “DTF Fund” or the “Fund”) was paying a $0.39 per share annualized dividend and had a closing price of $11.19 per share. The Fund’s monthly distribution was maintained at 3.25¢ per share for the previous twelve months.

On March 6, 2023, the DTF Fund amended its distribution policy to allow the Fund’s monthly distribution to include return of capital as well as net investment income. While a portion of future monthly distributions is expected to come from return of capital, the amended policy enables the Fund to maintain a more stable distribution, which is likely to be supportive of the Fund’s market price. A periodic return of capital also aligns with the short-term nature of the term structure of the Fund. The Fund’s policy of making annual distributions of capital gains is unaffected by this change. Refer to the financial highlights and income tax information section in this report for further information about the Fund’s distributions and its effect on net asset value.

THE CURRENT MUNICIPAL MARKET ENVIRONMENT

We begin our discussion of the DTF Fund for the six months ended October 31, 2024, with a review of the municipal market environment in which the Fund invests.

The six-months ended October 31, 2024, fell into two distinct periods. For the first five months (May 2024 to September 2024), rates largely moved lower as the market gained certainty about the beginning of the fed rate cut cycle. This was followed by an October surprise, which caused the bond market to step back and re-examine interest rates.

The month of May began with comments from Federal Reserve Chair Powell indicating that it was unlikely the next policy rate move would be a hike. This was supported by slower payroll growth numbers in May, and largely benign data releases in June. Softer economic data in July again set a strong tone for lower rates. Given the considerable inflation numbers over the first half of the year, a market-friendly Consumer Price Index (CPI) update on July 11th offered evidence that the short-term trajectory had shifted and was moving in the right direction. Having spiked to 4.5% in March, the three-month annualized core inflation rate declined to 2.1% through June. On the heels of a less than robust employment report, the inflation data added fuel to the Treasury market rally. In tandem, the short-term rates market began pricing in a more aggressive Fed easing cycle, which was confirmed at the July 31 meeting of the Federal Open Market Committee (the “Fed”), where Chair Powell stated that a discussion of rate cuts was likely on the table at their next meeting.

The July rate movement generated strong total returns across all sectors of the investment grade bond market. August offered a brief period of volatility for markets at the outset. A weak employment report on August 2 reignited fears that the U.S. economy could be headed for a more severe slowdown. Many worried that the Fed was behind the curve, having kept rates too high for too long. This fear was quelled by more growth-friendly data mid-month, and August went on to see positive returns across the fixed income market. September saw rates decline further, and debate over the ultimate size of the first rate cut dominated market commentary right up until the Fed’s meeting on September 18, when the Fed delivered an aggressive rate cut of 50 basis points (bps).

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Breaking with the preceding five-months, rates increased sharply in October, erasing most of the interest rate declines in the intermediate and long end of the curve. These moves were largely fueled by polls showing former President Trump as the 2024 presidential election favorite. Economists projected that the former president’s plan for significant tariffs and increased spending would be inflationary and could limit future Fed rate cuts. As a result, the curve dramatically steepened and fixed income markets saw large negative returns for the month of October.

The municipal yield curve twisted over the period as investors abandoned the intermediate part of the curve (7 to 12 years) in favor of the short end and the long end. Yields on the two-year AAA-rated municipal curve moved 53 bps lower during this period, while the ten-year was higher by 20 bps and 30-year was lower by 9 bps. The Bloomberg U.S. Municipal Index (a broad measure of the municipal market) returned 2.46% for the period. Bonds with maturities longer than 22 years and bonds rated BBB produced the largest gains, reporting more than 3.6% and 3.7%, respectively.

On a relative basis, during the six-months ended October 31, 2024, the Bloomberg U.S. Municipal Index (5.38%) outperformed the Bloomberg Treasury Index (4.78%), the Bloomberg U.S. Aggregate Bond Index (5.31%) and the Bloomberg U.S. Government/Credit Index (5.14%) while underperforming the Bloomberg Corporate Index (5.87%).

Municipal issuance through October 2024 was $444 billion, up 44% over 2023 and the strongest start to a year since 2007. Monthly issuance has been up on a year-over-year basis. October issuance rose to $64 billion, the second largest single month on record. The three states with the highest volume of municipal issuance so far this calendar year were Texas ($58.9 billion), California ($58.5 billion) and New York ($51.5 billion). Demand has been steady as mutual funds gained $25.9 billion in inflows and ETFs gained $11.4 billion, according to Lipper. These flows have helped the market to absorb this increase in supply without causing a meaningful market dislocation.

Municipal credit remains strong, with rating upgrades continuing to outpace downgrades in most sectors. Through October 31, 2024, the ratio of upgrades to downgrades for S&P was 1.57x. Within the state and local government sectors, the ratio is 2.38x. For many of these issuers, financial reserves are at or near record levels. This, combined with reduced recessionary expectations, should contribute to credit stability in 2025.

The transportation sector remains a bright spot. Airport passenger traffic is poised to have another record year, and toll road traffic also remains strong. Standard & Poor’s revised its outlook on the mass transit sector to Stable from Negative, following a similar action by Moody’s earlier this year. In one of the biggest headlines of the quarter, the New York Metropolitan Transportation Authority introduced its 2025 to 2029 capital plan, which has a total cost of $68.4 billion—and a $33.4 billion funding gap. The plan anticipates approximately $13 billion of additional debt. In the seaport sector, the major headline was the labor strike by dockworkers at East and Gulf Coast Ports, which was suspended after three days until January 2025. Moody’s aptly noted that, the impact on credit would depend on the length of the strike but that generally strong liquidity in the sector would partially offset revenue losses.

Over recent years, federal COVID relief funds were a stabilizing credit factor in many municipal sectors. This is particularly true for school districts, which account for a significant portion of tax-backed debt issuance. In addition to the infusion of federal funds, school districts also benefited from “hold-harmless” per-pupil funding on the part of some states. COVID funds must be allocated this year and spent by 2026. The return to normalcy after this, in which federal aid is much less abundant, may cause future budgetary pressure for both states and school districts. For the latter, the pressure may be double, as states will be less able to hold aid levels constant for districts experiencing declining growth. We note that many states offer credit enhancement programs to school district bond issuers, such as state aid withholding, state aid guarantees, and the Texas Permanent School Fund. These programs enabled public school districts to access the market with higher ratings and lower borrowing costs.

The higher education sector remains under pressure with continued enrollment declines and expense pressures. This remains especially true for smaller private institutions that do not possess the resources of larger institutions and have more difficulty attracting students. In contrast, the healthcare sector has seen small improvements in metrics with operating margins improved versus the lows of the pandemic. Despite this improvement, pressures remain, and we continue to be selective in our choice of credits.

Credit risk premiums, which refer to the additional yield that investors expect to receive as compensation for buying lower- rated securities, were tighter during the six-months ended October 31, 2024, for investment grade rated bonds (more so for

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BBB-rated bonds). Similarly, below investment grade rated credit risk premiums were tighter. Our investment strategy continues to focus on higher quality municipalities that exhibit value for the longer term. While the federal stimulus may have helped bolster the overall economy and municipal fundamentals, we believe that credits are not created equal and need to be analyzed with a longer-term horizon. Municipalities still face serious challenges in funding large capital expenditures to rebuild America’s aging infrastructure, improve pension plan funding, and protect communities against climate change.

LOOKING AHEAD

In our view, municipal bonds will likely remain attractive in 2025, fueled by strong investor demand. Absolute rates remain near decade highs, and credit fundamentals remain stable. Supply is likely to be sizeable, but solid investor demand should continue to keep the market in balance. Further, municipals continue to benefit from a lack of correlation to other asset classes, while defaults continue to be rare.

THE FUND

In managing the DTF Fund, we continue to emphasize our longstanding strategy of investing mostly in higher-quality, investment grade bonds. The portfolio is well distributed along the maturity and credit risk curve, with higher levels of “AA” rated bonds relative to the Bloomberg Municipal Bond 5 Year Index.

As of October 31, 2024, the Fund held more than 90% of its total assets in municipal bonds rated “A” or higher across multiple sectors and states. The Fund is diversified across various revenue sectors and general obligation bonds. More than 66% of the Fund is invested in revenue bonds as we prefer the dedicated revenue streams and the more settled legal protections these types of bonds have historically offered. Geographically, the Fund is well diversified with exposure to 30 states.

Maturity and duration are measures of the sensitivity of a fund’s portfolio to changes in interest rates. More specifically, duration refers to the percentage change in a bond’s price for a given change in rates (typically plus or minus 100 bps). In general, the greater the duration of a portfolio, the greater is the potential percentage price volatility for a given change in interest rates. As of October 31, 2024, the modified adjusted duration of the Fund’s portfolio was 3.0 years, compared to 3.7 years for the Bloomberg Municipal 5 Year Index.

In addition to the risk of disruptions in the broader credit market, the level of interest rates can be a primary driver of total returns, including the DTF Fund’s. As a practical matter, it is not possible for the Fund to be completely insulated from turmoil in the global financial markets, or unexpected moves in interest rates. Any sudden or unexpected rise in interest rates would likely reduce the total return, as higher interest rates could be expected to depress the valuations of fixed-rate bonds held in a fund. Management believes that over the long term, the diversification of the portfolio across multiple states and sectors, in addition to the distribution of assets along the yield curve, positions the Fund to take advantage of future opportunities while potentially limiting credit risk and volatility.

FUND PERFORMANCE

The following table compares the DTF Fund’s total return to the Bloomberg Municipal Bond 5 Year Index and Bloomberg U.S. Municipal Index. It is important to note that the index returns stated below include no fees or expenses, whereas the DTF Fund’s NAV returns are net of fees and expenses.

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Growth of $10,000

This graph shows the change in value of a hypothetical investment of $10,000 in the Fund for the years indicated. For comparison, the same investment is shown in the indicated indexes.

BOARD OF DIRECTORS MEETINGS

At the regular September and December 2024 meetings of the DTF Fund’s Board of Directors, the Board authorized the following monthly dividends:

ABOUT YOUR FUND

The Fund’s investment objective is current income exempt from regular federal income tax consistent with the preservation of capital. The Fund seeks to achieve its investment objective by investing primarily (at least 80% of its total assets) in a

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diversified portfolio of investment-grade tax-exempt obligations. The Fund may not invest more than 25% of its total assets (taken at market value at the time of each investment) in the securities of issuers in a single industry; provided that, for purposes of this restriction, tax exempt securities of issuers that are states, municipalities or their political subdivisions are not considered to be the securities of issuers in any single industry.

PORTFOLIO MANAGEMENT TEAM

On March 15, 2024, Dusty L. Self was appointed by the Fund’s Board of Directors as Chief Investment Officer and Phillip Hooks, CFA, was added to the Fund’s portfolio management team.

Ms. Self has been the Fund’s lead portfolio manager since June of 2023 and has served as a Vice President and portfolio manager of the Fund since 2022. Ms. Self has more than 30 years of experience focused on investment grade municipal strategies. Mr. Hooks brings 19 years of industry experience, concentrated in portfolio management and municipal bond research. Both Ms. Self and Mr. Hooks are “dual hatted” employees of Seix Investment Advisors (“Seix”) and Duff & Phelps Investment Management Co., the Fund’s investment adviser. Seix is a division of Virtus Fixed Income Advisors, LLC. Each of these entities is an affiliate of Virtus Investment Partners, Inc.

It is a privilege and honor to serve you, and we are excited for the future.

Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein, are those of the portfolio managers as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The DTF Fund disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

SCHEDULE OF INVESTMENTS

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

SCHEDULE OF INVESTMENTS—(Continued)

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

SCHEDULE OF INVESTMENTS—(Continued)

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

SCHEDULE OF INVESTMENTS—(Continued)

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

SCHEDULE OF INVESTMENTS—(Continued)

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

STATEMENT OF ASSETS AND LIABILITIES

October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

STATEMENT OF OPERATIONS

For the year ended October 31, 2024

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

STATEMENTS OF CHANGES IN NET ASSETS

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

FINANCIAL HIGHLIGHTS—SELECTED PER SHARE DATA AND RATIOS

The table below provides information about income and capital changes for a share of common stock outstanding throughout the years indicated (excluding supplemental data provided below):

The accompanying notes are an integral part of these financial statements.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

NOTES TO FINANCIAL STATEMENTS

October 31, 2024

Note 1. Organization

DTF Tax-Free Income 2028 Term Fund Inc. (the “Fund”) was incorporated under the laws of the State of Maryland on September 24, 1991. The Fund commenced operations on November 29, 1991 as a diversified, closed-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The Fund’s investment objective is current income exempt from regular federal income tax consistent with preservation of capital.

The Fund will terminate on or before March 1, 2028 unless (i) within 12 months prior to that date, the Fund conducts a tender offer for all of its outstanding shares at 100% of their net asset value, (ii) the results of the tender offer leave the Fund with net assets of at least $75 million and (iii) a majority of the entire Board of Directors votes to reinstate the Fund’s perpetual existence.

Note 2. Significant Accounting Policies

The Fund is an investment company that follows the accounting and reporting guidance of Accounting Standards Codification (“ASC”) Topic 946 applicable to Investment Companies.

The following are the significant accounting policies of the Fund.

A. Investment Valuation: Debt securities are generally valued based on the evaluated bid using prices provided by one or more dealers regularly making a market in that security, an independent pricing service, or quotes from broker-dealers, when such prices are believed to reflect the fair value of such securities and are generally classified as Level 2. The relative liquidity of some securities in the Fund’s portfolio may adversely affect the ability of the Fund to accurately value such securities. The Fund’s Board of Directors has designated the Investment Adviser as the valuation designee to perform fair valuations pursuant to Rule 2a-5 under the 1940 Act. Any securities for which it is determined that market prices are unavailable or inappropriate are fair valued using the Investment Adviser’s Valuation Committee’s own assumptions and are classified as Level 2 or 3 based on the valuation inputs.

B. Investment Transactions and Investment Income: Securities transactions are recorded on the trade date. Realized gains and losses on sales of securities are determined on the identified cost basis. Interest income is recorded on the accrual basis. The Fund amortizes premiums and accretes discounts on securities using the effective interest method. Premiums on securities are amortized over the period remaining until first call date, if any, or if none, the remaining life of the security and discounts are accreted over the remaining life of the security for financial reporting purposes.

C. Federal Income Taxes: It is the Fund’s intention to comply with requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income and capital gains to its shareholders. Therefore, no provision for federal income or excise taxes is required. Management of the Fund has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. The Fund’s U.S. federal income tax returns are generally subject to examination by the Internal Revenue Service for a period of three years after they are filed. State and local tax returns and/or other filings may be subject to examination for different periods, depending upon the rules of each applicable jurisdiction.

D. Dividends and Distributions: The Fund declares and pays dividends on its common stock monthly from net investment income. Net capital gains, if any, in excess of capital loss carryforwards are expected to be distributed annually. Dividends and distributions are recorded on the ex-dividend date.

The amount and timing of distributions are generally determined in accordance with federal tax regulations, which may differ from U.S. generally accepted accounting principles.

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

NOTES TO FINANCIAL STATEMENTS—(Continued)

October 31, 2024

E. Use of Estimates: The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Note 3. Agreements and Management Arrangements

A. Adviser: The Fund has an Advisory Agreement with Duff & Phelps Investment Management Co. (the “Adviser”), an indirect, wholly owned subsidiary of Virtus Investment Partners, Inc. (“Virtus”). The investment advisory fee is payable monthly at an annual rate of 0.50% of the Fund’s average weekly managed assets, which is defined as the average weekly value of the total assets of the Fund minus the sum of all accrued liabilities of the Fund (other than the aggregate amount of any outstanding borrowings or other indebtedness constituting financial leverage).

B. Administrator: The Fund has an Administration Agreement with Robert W. Baird & Co. Incorporated (the “Administrator” or “Baird”). The administration fee is payable quarterly at an annual rate of 0.14% of the Fund’s average weekly net assets, which is defined as the average weekly value of the total assets of the Fund minus the sum of all accrued liabilities of the Fund (including the aggregate amount of any outstanding borrowings or other indebtedness constituting financial leverage).

C. Directors: The Fund pays each director not affiliated with the Adviser an annual fee. Total fees paid to directors for the year ended October 31, 2024 were $11,947.

Note 4. Investment Transactions

Purchases and sales of investment securities for the year ended October 31, 2024 were $49,901,810, and $49,591,483, respectively.

Note 5. Distributions and Tax Information

At October 31, 2024, the approximate federal tax cost and aggregate gross unrealized appreciation (depreciation) were as follows:

The tax character of distributions paid to common shareholders during the years ended October 31, 2024 and 2023 was as follows:

At October 31, 2024, the components of accumulated losses on a tax basis were as follows:

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DTF TAX-FREE INCOME 2028 TERM FUND INC.

NOTES TO FINANCIAL STATEMENTS—(Continued)

October 31, 2024

At October 31, 2024, the Fund had unused capital loss carryforwards available to offset future capital gains, if any, to the extent permitted by the Internal Revenue Code. The character and amounts of the carryforwards are given in the table below. These capital losses are not subject to expiration.

Note 6. Reclassification of Capital Accounts

Certain capital accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. Permanent reclassifications can arise from differing treatment of certain income and gain transactions. These adjustments have no impact on net assets or net asset value per share of the Fund. Temporary differences that arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will likely reverse at some time in the future.

The reclassifications at October 31, 2024 primarily relate to accrued market discount on securities held.

Note 7. Remarketable Variable Rate MuniFund Term Preferred Shares

During the year ended October 31, 2023, the Fund voluntarily redeemed all 650 of its Series 2050 Remarketable Variable Rate MuniFund Term Preferred Shares (“RVMTP Shares”): 250 shares on November 16, 2022, 250 shares on June 15, 2023, and 150 shares on July 31, 2023. Each RVMTP Share was redeemed at 100% of its liquidation preference of $100,000 per share plus accrued dividends. The RVMTP Shares were a floating-rate form of preferred stock originally issued on November 2, 2020 in a private placement. Effective with the redemption of 150 RVMTP Shares on July 31, 2023, the Fund maintains no leverage.

Note 8. Indemnifications

Under the Fund’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Fund. In addition, in the normal course of business, the Fund enters into contracts that provide general indemnifications to other parties. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not occurred. However, the Fund has not had prior claims or losses pursuant to these arrangements and expects the risk of loss to be remote.

Note 9. Subsequent Event

Management has evaluated the impact of all subsequent events on the Fund through the date the financial statements were issued, and has determined that there were no subsequent events requiring recognition or disclosure in these financial statements other than the matter disclosed below.

At its regular meeting held on December 11, 2024, the Fund’s Board of Directors approved an administration services contract with Virtus Fund Services, LLC (“VFS”), an indirect, wholly owned subsidiary of Virtus, for the one-year period beginning March 1, 2025. On that date, VFS will assume the responsibilities currently performed by Baird.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders of

DTF Tax-Free Income 2028 Term Fund Inc.:

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of DTF Tax-Free Income 2028 Term Fund Inc. (the “Fund”), including the schedule of investments, as of October 31, 2024, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund at October 31, 2024, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and its financial highlights for each of the five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of the Fund’s internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2024, by correspondence with the custodian and brokers. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more Duff & Phelps Investment Management Co. investment companies since 1991.

Chicago, Illinois

December 13, 2024

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TAX INFORMATION (Unaudited)

The following information is being provided in order to meet reporting requirements set forth by the Code and/or meet state specific requirements. In early 2025, the Fund will make available the tax status of all distributions paid for the calendar year 2024. Shareholders should consult their tax advisors. With respect to distributions paid to common shareholders during the fiscal year ended October 31, 2024, the Fund designates the following amounts (or, if subsequently determined to be different, the maximum amount allowable):

INFORMATION ABOUT PROXY VOTING BY THE FUND (Unaudited)

Although the Fund does not typically hold voting securities, a description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling the Administrator toll-free at (833) 604-3163 or is available on the Fund’s website www.dpimc.com/dtf or on the SEC’s website www.sec.gov.

INFORMATION ABOUT THE FUND’S PORTFOLIO HOLDINGS (Unaudited)

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third fiscal quarters of each fiscal year (quarters ended January 31 and July 31) as an exhibit to Form NPORT-P. The Fund’s Form NPORT-P is available on the SEC’s website at www.sec.gov. In addition, the Fund’s schedule of portfolio holdings is available without charge, upon request, by calling the Administrator toll-free at (833) 604-3163 or is available on the Fund’s website at www.dpimc.com/dtf.

ADDITIONAL INFORMATION (Unaudited)

Since October 31, 2023: (i) there have been no material changes in the Fund’s investment objectives or policies that have not been approved by the shareholders; (ii) there have been no changes in the Fund’s charter or by-laws that would delay or prevent a change in control of the Fund which have not been approved by the shareholders; (iii) there have been no material changes in the principal risk factors associated with an investment in the Fund; and (iv) there have been changes in the persons who are primarily responsible for the day-to-day management of the Fund’s portfolio. Phillip H. Hooks, CFA, was added as a portfolio manager on March 15, 2024.

Additional information, if any, relating to the Fund’s directors and officers, in addition to such information as is found elsewhere in the Annual Report, may be requested by contacting the Fund at the address provided in this report.

Notice is hereby given in accordance with Section 23(c) of the 1940 Act that the Fund may from time to time purchase its shares of common stock in the open market.

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INVESTMENT OBJECTIVES, PRINCIPAL STRATEGIES AND PRINCIPAL RISKS (Unaudited)

Investment Objective: The Fund’s investment objective is current income exempt from regular federal income tax consistent with the preservation of capital.

Principal Strategies: The Fund seeks to achieve its investment objective by investing primarily (at least 80% of its total assets) in a diversified portfolio of investment grade tax-exempt obligations.

Under normal market conditions, the Fund will not invest more than 25% of its total assets (taken at market value at the time of each investment) in securities of issuers in a single industry; provided that, for purposes of this restriction, tax-exempt securities of issuers that are states, municipalities or their political subdivisions are not considered to be the securities of issuers in any single industry. The Fund will also not invest more than 20% of its assets in obligations that pay interest that is subject to the alternative minimum tax.

All of the Fund’s investments at the time of purchase will be rated at least investment grade or, with respect to no more than 20% of total assets, unrated but of comparable credit quality of obligations rated investment grade.

The Fund does not currently utilize derivatives or invest in derivatives.

Principal Risks:

Credit & Interest Rate Risk: Debt securities are subject to various risks, the most prominent of which are credit and interest rate risk. The issuer of a debt security may fail to make interest and/or principal payments. Values of debt securities may rise or fall in response to changes in interest rates, and this risk may be enhanced with longer-term maturities.

Municipal Securities Risk: Events negatively impacting a municipality, municipal security, or the municipal bond market in general, may cause the fund to decrease in value, perhaps significantly.

Industry/Sector Concentration Risk: The value of the investments of a fund that focuses its investments in a particular industry or market sector will be highly sensitive to financial, economic, political and other developments affecting that industry or market sector, and conditions that negatively impact that industry or market sector will have a greater impact on the Fund as compared with a fund that does not have its holdings concentrated in a particular industry or market sector. Events negatively affecting the industries or market sectors in which the Fund has invested are therefore likely to cause the value of the Fund’s shares to decrease, perhaps significantly.

Market Volatility Risk: The value of the securities in which the Fund invests may go up or down in response to the prospects of individual issuers and/or general economic conditions. Such price changes may be temporary or may last for extended periods.

Instability in the financial markets may expose the Fund to greater market and liquidity risk and potential difficulty in valuing portfolio instruments that it holds. In response to financial markets that experienced extreme volatility, and in some cases a lack of liquidity, the U.S. Government and other governments have taken a number of unprecedented actions, including acquiring distressed assets from financial institutions and acquiring ownership interests in those institutions. The implications of government ownership and disposition of these assets are unclear. Additional legislation or government regulation may also change the way in which funds themselves are regulated, which could limit or preclude the Fund’s ability to achieve its investment objective. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issue, recessions, or other events could have a significant impact on the Fund and its investments, hampering the ability of the Fund’s portfolio managers to invest the Fund’s assets as intended.

Income Risk: Income received from the Fund may vary widely over the short- and long-term and/or be less than anticipated if the proceeds from maturing securities in the Fund are reinvested in lower-yielding securities.

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Prepayment/Call Risk: Issuers may prepay or call their fixed rate obligations when interest rates fall, forcing the Fund to reinvest in obligations with lower interest rates and the Fund may not benefit fully from the increase in value that other fixed income investments experience when interest rates decline.

Tax-Exempt Securities Risk: Tax-exempt securities may not provide a higher after-tax return than taxable securities, and/or the tax-exempt status may be lost or limited.

Tax Liability Risk: Noncompliant conduct by a municipal bond issuer, or certain adverse interpretations or actions by a government or tax authority, could cause interest from a security to become taxable, possibly retroactively, subjecting shareholders to increased tax liability.

State and AMT Tax Risk: A portion of income may be subject to some state and/or local taxes and, for certain investors, a portion may be subject to the federal alternative minimum tax.

Unrated Fixed Income Securities Risk: If the Adviser is unable to accurately assess the quality of an unrated fixed income security, the Fund may invest in a security with greater risk than intended, or the securities may be more difficult to sell than anticipated.

Management Risk: The Fund is subject to management risk because it is an actively managed investment portfolio with broad investment mandates. The Adviser will apply investment techniques and risk analysis in making investment decisions for the Fund, but there can be no guarantee that these will produce the desired results.

Closed-End Fund Risk: Closed-end funds may trade at a discount or premium from their net asset values, which may affect whether an investor will realize gains or losses. They may also employ leverage, which may increase volatility.

No Guarantee: There is no guarantee that the portfolio will meet its objective.

21

INFORMATION ABOUT DIRECTORS AND OFFICERS OF THE FUND (Unaudited)

Set forth below are the names and certain biographical information about the directors and officers of the Fund as of the date of issuance of this report.

DIRECTORS OF THE FUND (Unaudited)

Directors are divided into three classes and are elected to serve staggered three-year terms. All of the current directors of the Fund, with the exception of Mr. Aylward, are classified as independent directors because none of them are “interested persons” of the Fund, as defined in the 1940 Act. Mr. Aylward is an “interested person” of the Fund by reason of his position as President and Chief Executive Officer of Virtus, the ultimate parent company of the Adviser and various positions with its affiliates. The term “Fund Complex” refers to the Fund and all the other investment companies advised by affiliates of Virtus. The term “Fund Complex” refers to the Fund and all the other investment companies advised by affiliates of Virtus.

The address for all directors is c/o Duff & Phelps Investment Management Co., 10 South Wacker Drive, Suite 1900, Chicago, Illinois 60606. All of the Fund’s directors currently serve on the Board of Directors of two other registered closed-end investment companies that are advised by Duff & Phelps Investment Management Co.: DNP Select Income Fund Inc. (“DNP”) and Duff & Phelps Utility and Infrastructure Fund Inc. (“DPG”).

22

23

OFFICERS OF THE FUND (Unaudited)

The officers of the Fund are elected annually by the Board of Directors of the Fund and serve until their respective successors are chosen and qualified. The Fund’s officers receive no compensation from the Fund, but are also officers of the Adviser, Virtus or the Administrator and receive compensation in such capacities. Information pertaining to the officers of the Fund is set forth below. The address for all officers noted below is c/o Duff & Phelps Investment Management Co., 10 South Wacker Drive, Suite 1900, Chicago, Illinois 60606, except as noted.

24

DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN (Unaudited)

Pursuant to the Fund’s Dividend Reinvestment Plan (the “Plan”), common shareholders may elect to have all distributions of dividends and capital gains automatically reinvested by Equiniti Trust Company, LLC (formerly known as American Stock Transfer & Trust Company, LLC) (the “Plan Agent”) in shares of common stock of the Fund (“Fund Shares”) pursuant to the Plan; provided that such election is subject to the power of the Board of Directors to declare capital gains distributions in the form of stock (if such a declaration is made by the Board of Directors, all shareholders who do not elect to receive cash will receive the distribution in the form of stock whether or not they elect to participate in the Plan). Common shareholders who do not participate in the Plan will receive all distributions in cash (except as described above) paid by check in United States dollars mailed directly to the shareholder of record (or if the shares are held in street or other nominee name, then to the nominee) by the Custodian, as dividend disbursing agent. Common shareholders who wish to participate in the Plan should contact the Fund at P.O. Box 500, Newark, New Jersey, 07101 or call toll free (866) 668-8552.

The Plan Agent serves as agent for the common shareholders in administering the Plan. After the Fund declares a dividend or determines to make a capital gain distribution, if (1) the market price is lower than net asset value, the participants in the Plan will receive the equivalent in Fund Shares valued at the market price determined as of the time of purchase (generally, the payment date of the dividend or distribution); or if (2) the market price of Fund Shares on the payment date of the dividend or distribution is equal to or exceeds their net asset value, participants will be issued Fund Shares at the higher of net asset value or 95% of the market price. This discount reflects savings in underwriting and other costs that the Fund otherwise will be required to incur to raise additional capital. If net asset value exceeds the market price of Fund Shares on the payment date or the Fund declares a dividend or other distribution payable only in cash (i.e., if the Board of Directors precludes reinvestment in Fund Shares for that purpose), the Plan Agent will, as agent for the participants, receive the cash payment and use it to buy Fund Shares in the open market, on the New York Stock Exchange, other national securities exchanges on which the Fund’s common stock is listed or elsewhere, for the participants’ accounts. If, before the Plan Agent has completed its purchases, the market price exceeds the net asset value of a Fund Share, the average per share purchase price paid by the Plan Agent may exceed the net asset value of Fund Shares, resulting in the acquisition of fewer shares than if the dividend or distribution had been paid in shares issued by the Fund. The Fund will not issue shares under the Plan below net asset value.

Participants in the Plan may withdraw from the Plan upon written notice to the Plan Agent and will receive certificates for whole Fund Shares and a cash payment will be made for any fraction of a Fund Share.

There is no charge to participants for reinvesting dividends or capital gain distributions, except for certain brokerage commissions, as described below. The Plan Agent’s fees for the handling of the reinvestment of dividends and distributions will be paid by the Fund. There will be no brokerage commissions charged with respect to shares issued directly by the Fund. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent’s open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any federal income tax that may be payable on such dividends or distributions.

Experience under the Plan may indicate that changes are desirable. Accordingly, the Fund reserves the right to amend or terminate the Plan as applied to any dividend or distribution paid subsequent to written notice of the change sent to all shareholders of the Fund at least 90 days before the record date for the dividend or distribution. The Plan also may be amended or terminated by the Plan Agent upon at least 90 days written notice to all common shareholders of the Fund. All correspondence concerning the Plan should be directed to the Fund at the address on the back of this report.

The Plan permits Plan participants to periodically purchase additional shares of common stock through the Plan by delivering to the Plan Agent a check (or authorizing an electronic fund transfer) for at least $100, but not more than $5,000, in any month. The Plan Agent will use the funds to purchase shares in the open market or in private transactions as described above with respect to reinvestment of dividends and distributions. Purchases made pursuant to this feature of the Plan will be made commencing at the time of the first dividend or distribution payment following the second business day after receipt of the funds for additional purchases, and may be aggregated with purchases of shares for reinvestment of the dividends and distributions.

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Shares will be allocated to the accounts of participants purchasing additional shares at the average price per share, plus a service charge imposed by the Plan Agent and brokerage commissions (or equivalent purchase costs) paid by the Plan Agent for all shares purchased by it, including for reinvestment of dividends and distributions. Checks drawn on a foreign bank are subject to collection and collection fees, and will be invested at the time of the next distribution after funds are collected by the Plan Agent.

The Plan Agent will make every effort to invest funds promptly, and in no event more than 30 days after the Plan Agent receives a dividend or distribution, except where postponement is deemed necessary to comply with applicable provisions of the federal securities laws.

Funds sent to the Plan Agent for voluntary additional share investment may be recalled by the participant by written notice received by the Plan Agent not later than two business days before the next distribution payment date. If for any reason a regular monthly distribution is not paid by the Fund, funds for voluntary additional share investment will be returned to the participant, unless the participant specifically directs that they continue to be held by the Plan Agent for subsequent investment.

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As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant’s principal executive officer and principal financial officer (the “Code of Ethics”). The registrant’s principal financial officer also performs the functions of principal accounting officer.

The text of the Code of Ethics is posted on the registrant’s website at http://www.dpimc.com/dtf. In the event that the registrant makes any amendment to or grants any waiver from the provisions of the Code of Ethics, the registrant intends to disclose such amendment or waiver on its website within five business days.

The registrant’s board of directors has determined that three members of its audit committee: Donald C. Burke, Philip R. McLoughlin and David J. Vitale, are audit committee financial experts and that each of them is “independent” for purposes of this Item.

The following table sets forth the fees billed to the registrant for each of the last two fiscal years for professional services rendered by the registrant’s principal accountant, Ernst & Young LLP, an independent registered public accounting firm (the “Independent Auditor”).

(e)(1) Disclose the audit committee’s pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

Pre-Approval Policy for Audit and Non-Audit Services

The Audit Committee of the Board of Directors of DTF Tax-Free Income 2028 Term Fund Inc. (the “Fund”) has adopted policies and procedures for the pre-approval of services provided by Ernst & Young LLP (the “Policy”).

Under the Policy, the Audit Committee identifies certain audit, audit-related, and tax services, which the Audit Committee may pre-approve on a general basis (i.e., without case-by-case consideration) (“general pre-approval”). Additionally, the Audit Committee may grant general pre-approval to certain non-audit services identified in the Policy provided to the Fund or its affiliates that relate directly to the operations and financial reporting of the Fund, so long as the Audit Committee believes such services are (a) consistent with the SEC’s auditor independence rules, and (b) routine and recurring services that will not impair the independence of the independent auditors. In addition to the foregoing, the Audit Committee must pre-approve, on a case-by-case basis (“specific pre-approval”) (1) annual audit services engagement terms and fees, (2) any audit-related services not subject to general pre-approval in the Policy, (3) tax services related to large and complex transactions, and (4) any other non-audit services not subject to general pre-approval in the Policy.

The Audit Committee has determined that the Chair of the Audit Committee may provide specific pre-approval for such services that meet the above requirements but are not included in the general pre-approval in the event such approval is sought between regularly scheduled meetings. The Chair of the Audit Committee will report each service pre-approved by the Chair between meetings of the Audit Committee to the Audit Committee at the next regularly scheduled in-person Audit Committee meeting.

Pre-approval fee levels or budgeted amounts for all services to be provided by the independent auditor will be established annually by the Audit Committee. Any proposed services exceeding these levels or amounts will require specific pre-approval by the Audit Committee.

(f)  The percentage of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than fifty percent.

(h)  The registrant’s audit committee of the board of directors has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

(i)  Not applicable.

(j)  Not applicable.

The registrant has a separately-designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (the “Exchange Act”). The members of the Audit Committee are Donald C. Burke, Mareilé B. Cusack, Philip R. McLoughlin, Geraldine M. McNamara, Eileen A. Moran and David J. Vitale.

(a)  Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1(a) of this form.

(b)  Not applicable.

(a)  Not applicable.

(b)  Not applicable.

Not applicable.

Not applicable.

Not applicable.

Not applicable.

Although the registrant does not typically hold voting securities, the registrant’s board of directors has adopted the following proxy voting policies and procedures with respect to proxy voting.

DNP SELECT INCOME FUND INC.

DUFF & PHELPS UTILITY AND INFRASTRUCTURE FUND INC.

DTF TAX-FREE INCOME 2028 TERM FUND INC.

PROXY VOTING POLICIES AND PROCEDURES

As Amended June 9, 2022

In this Item 13, the term “Fund” refers to the registrant, DTF Tax-Free Income 2028 Term Fund Inc.

The Fund’s Portfolio Managers

The portfolio managers employed by Seix Investment Advisors LLC, a division of Virtus Fixed Income Advisers, LLC (“Seix”), an affiliate of Duff & Phelps Investment Management Co., the Fund’s investment adviser (the “Adviser”), are responsible for the day-to-day management of the Fund’s portfolio. The portfolio managers are dual hatted employees of the Adviser and Seix, each of which is a subsidiary and affiliated manager of Virtus Investment Partners, Inc. (“Virtus”). The portfolio managers, as of December 20, 2024, are as follows:

Phillip H. Hooks, CFA has been portfolio manager of the Fund since March 15, 2024. He is a portfolio manager and research analyst for Seix. Mr. Hooks joined Seix upon integration in 2014, having joined a predecessor firm in 2009. He began his career in the investment industry in 2005, as a municipal analyst for Evergreen Investment Management Company. Mr. Hooks holds the Chartered Financial Analyst (CFA) designation.

Dusty L. Self has been Chief Investment Officer of the Fund since March 15, 2024. She has been Vice President of the Fund since 2022 and the Fund’s lead portfolio manager since 2023. She is Managing Director and Senior Portfolio Manager – Tax-Exempt Assets for Seix. Before attaining her current position as Portfolio Manager with Seix. Ms. Self worked as a portfolio specialist and then as a performance analyst. Prior to beginning her career in investment management with Seix’s predecessor firm, she worked for Barnett Bank in the Commercial Loans division. Ms. Self joined Seix upon integration in 2014, having joined a predecessor firm in 1992. Ms. Self has over 30 years of experience focused on investment grade fixed income strategies.

Other Accounts Managed by the Fund’s Portfolio Managers

The following table provides information as of October 31, 2024 regarding the other accounts besides the Fund that are managed by the portfolio manager of the Fund. As noted in the table, portfolio manager of the Fund may also manage or be members of management teams for other mutual funds within the same fund complex or other similar accounts. For purposes of this disclosure, the term “fund complex” includes the Fund and all other investment companies advised by affiliates of Virtus, the Adviser’s ultimate parent company. As of October 31, 2024, the Fund’s portfolio managers did not manage any accounts with respect to which the advisory fee is based on the performance of the account, nor do they manage any hedge funds.

There may be certain inherent conflicts of interest that arise in connection with the portfolio managers’ management of the Fund’s investments and the investments of any other accounts they manage. Such conflicts could include aggregation of orders for all accounts managed by a particular portfolio manager, the allocation of purchases across all such accounts, the allocation of IPOs and any soft dollar arrangements that the Adviser may have in place that could benefit the Fund and/or such other accounts. The Adviser has adopted policies and procedures designed to address any such conflicts of interest to ensure that all management time, resources and investment opportunities are allocated equitably. There have been no material compliance issues with respect to any of these policies and procedures during the Fund’s most recent fiscal year.

Compensation of the Fund’s Portfolio Managers

The following is a description of the compensation structure, as of October 31, 2024, of the Fund’s portfolio managers.

Portfolio manager compensation generally consists of base salary, bonus, and various employee benefits and may also include long-term stock awards, deferred cash, retention bonuses, and/or incentive guarantees. These components are tailored in an effort to retain high quality investment professionals and to align compensation with performance.

A portfolio manager’s base salary is determined by the individual’s experience, responsibilities within the firm, performance in the role, and market rate for the position.

Each portfolio manager’s bonus incorporates an evaluation of the Fund’s investment performance as well as other factors, including subjective factors. Investment performance may be evaluated directly against a peer group and/or benchmark, or indirectly by measuring overall business unit financial performance over a period of time. Where applicable, investment performance is determined by comparing a Fund’s pre-tax total return to the returns of the Fund’s peer group and/or benchmark over multi-year periods. Where portfolio managers are responsible for multiple Funds or other managed accounts, each product is weighted based on its size and relative strategic importance to the Adviser and/or Sub-adviser. Other factors that may be considered in the calculation or payout of incentive bonuses include adherence to compliance policies, risk management practices, sales/marketing, leadership, communications, corporate citizenship, and overall contribution to the firm. Bonuses are typically paid annually.

Retention bonuses and/or incentive guarantees for a fixed period may also be used when the Adviser and/or Sub-adviser deem it necessary to recruit or retain the employee.

All full-time employees of Seix, including the Funds’ portfolio managers, are provided a benefits package on substantially similar terms. The percentage of each individual’s compensation provided by these benefits is dependent upon length of employment, salary level, and several other factors.

Other Benefits: Portfolio managers are eligible to participate in a 401(k) plan, health insurance, and other benefits offered generally to the firm’s employees that could include granting of restricted stock units in Virtus stock.

Equity Ownership of Portfolio Managers

The following table sets forth the dollar range of equity securities in the Fund beneficially owned, as of October 31, 2024, by the portfolio managers identified above.

During the period covered by this report, no purchases were made by or on behalf of the registrant or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of shares or other units of any class of the registrant’s equity securities that is registered by the registrant pursuant to Section 12 of the Exchange Act.

No changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors have been implemented after the registrant last provided disclosure in response to the requirements of Item 22(b)(15) of Schedule 14A (i.e., in the registrant’s Proxy Statement dated January 24, 2024) or this Item.

(a)  The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b)  There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d))) that occurred during the most recent fiscal period that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

(a)  Not applicable.

(b)  Not applicable.

Not applicable.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.