@aE
The good news is that the program treats such capital gains distributions as long-term gains, which receive preferential tax treatment. Depending on your overall income level, all or a portion of a capital gains distribution may be taxed at the 0 (zero) % capital gains tax rate, or for higher income folks, some portion may be at the 15% or 20% capital gains tax rate. How it breaks down all depends on your overall income.
If you have any "qualified dividends" (Box 1b on a 1099-DIV), they, too, receive the same preferential tax treatment.
