Mutual funds are different from other investments securities. With mutual funds, you will owe tax on two levels if a stock holding in your mutual fund pays dividends, then the fund manager later sells the stock at a higher value than they paid for it:
- A dividend tax, generally applied at your income tax rate
- A capital gains tax, which will be taxed at capital gains rates.
Without seeing the actual return/form I can only speculate further.
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