Taxes

[Drew100]

I still would like to know how to determine what percentage of capital gains reported by a mutual fund is from US obligations.  Vanguard and Columbia could not answer that question.  They give you information about the percentage of ordinary dividends that is from US obligations. The information is needed to complete my MD state taxes.  

[Hal_Al]

Q. I still would like to know how to determine what percentage of capital gains reported by a mutual fund is from US obligations?

A.   Vanguard and Columbia  gives you information about the percentage of ordinary dividends that is from US obligations. That is your answer. 

If you have a 1099-DIV, from a mutual fund, and a portion of the dividends are from U.S. securities; after entering your 1099-DIV, you will reach a screen: "Tell us if any of these uncommon situations apply to you". Check the box "A portion of these dividends is U.S. Government interest".  

You have to manually calculate the amount, to enter, by multiplying box 1a times the percentage you got from Vanguard and Columbia.

[Drew100]

Thank you for the information.  One follow-up question that maybe you can help with.

Your answer addresses ordinary dividends but how do I determine what percentage of capital gains is from US obligations?  The mutual companies I contacted were not able to answer this question. 

[Hal_Al]

Q. How do I determine what percentage of capital gains is from US obligations? 

A.  It's none (0%). 

It's only the interest from  U.S. obligations that state tax exempt. What some mutual fund companies label as dividends is actually just interest. 

[Drew100]

Can you explain why it is 0%?  If it is always 0%, why would MD tax instructions say to include only dividends attributable to interest OR capital gains from US Gvt obligations? 

[Hal_Al]

Q. Can you explain why it is 0%? 

A. In your case, it's 0 because your mutual fund company didn't provide you a number.

A more accurate general answer is "it's almost always zero''. It's rare that a mutual fund company will report that.  But, investors who actually trade US bonds could see a reportable gain. 

[Drew100]

Thanks. 

"In your case, it's 0 because your mutual fund company didn't provide you a number."

and

"A more accurate general answer is "it's almost always zero''.

I've done a ton of research online and have not come across these statements.   Can you explain further?