turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

Mutual Fund Loss

Mutual Fund loss in value of $25K (from Jan to Nov) then we get a $16K capital gain payout in Dec --- and I get nailed on taxes for $16K capital gains!  Does this make sense?

Connect with an expert
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

2 Replies
jtax
Level 10

Mutual Fund Loss

Yes, it does. It is called "buying a dividend" (or in this case capital gain distribution). It is unfortunate, especially for capital gain distributions, which you may not have been able to anticipate (being irregular compared to dividends). Those distributions are gains the fund had from selling winners and had to distribute so you pay the tax and not the fund. Does seem like a lot, but it does happen.

The good news is capital gains have never been taxed at such low rates in history and might even be taxed at zero percent depending upon your income level. Also if you reinvested the distribution you have increased your basis in the shares and will have less of a gain when you eventually sell.

See e.g. https://investor.vanguard.com/investing/taxes/buying-dividend

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

Mutual Fund Loss

Much thanks!
message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
Manage cookies