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onceupontaxes
New Member

How do I report the State Reporting Information for Mutual Funds and Unit Trusts?

I have a 2019 Supplemental Tax Statement with State Reporting information for Mutual Funds and Unit Trusts listing ETFs in the below categories:

1) Direct Federal Obligations

2) Indirect Federal Obligations

3) Foreign Source Income

 

A) How do I report each of them in my State (Colorado) tax declaration? Please describe step by step the forms and boxes I should consider.

B) Any impact on my Federal declaration? Please, if possible describe step by step the forms and boxes I should consider.

 

Thanks in advance.

3 Replies
jtax
Level 9

How do I report the State Reporting Information for Mutual Funds and Unit Trusts?

Sorry but I can't really go through how to report line by line, but i can give you a rough idea. There are probably previous questions and answers about this if you search this mostly volunteer forum. Or perhaps someone else will reply.

 

First, for most people these are small amounts. There is also no requirement to report them. By skipping them you might pay a little bit more in tax, but again for most people that might be zero or close to zero.

 

First, you must use the supplemental statement to figure out the $ amount for each item. E.g. they usually things like Fund ABC, 2% federal direct obligations. You need to find (in your statements, 1099-DIV supplemental info) how much Fund ABC pay you for dividends. Let's say $500. Then 2% of that or $10 is from federal direct obligations. 

You then review the 1099-DIV for that payer and enter $10 in the interview. Look carefully for question/checkbox "A portion of this dividends is US Government Interest" ... what this does is to remove the $10 from your STATE income tax because the Constitution doesn't allow states to tax direct federal interest. You can see how the gain might not be large.

 

Foreign source income is on relevant if your investments paid foreign income tax (1099-DIV box 7) or perhaps if you have other foreign income. If so TT should ask you about that toward the end of the interview.

 

I hope that helps at least a little bit.

 

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onceupontaxes
New Member

How do I report the State Reporting Information for Mutual Funds and Unit Trusts?

Hello and thanks for the reply

 

The direct and indirect federal are done, thanks.

 

The Foreign source income I did already report on 1099-DIV box 7.

The question is, anything to report on the state of Colorado for Foreign source income?

jtax
Level 9

How do I report the State Reporting Information for Mutual Funds and Unit Trusts?

Getting state specific info from this volunteer forum is always a little iffy, simply because there isn't usually anyone reading a particular question with experience in that particular state (except for the big ones like CA and NY).

 

So I don't know the answer about CO and foreign taxes. You don't have to claim a foreign tax credit deduction. As long as you report the income you are ok. But of course if you can claim a credit/deduction that would be great. I would expect TT to ask you about it or automatically transfer if it could.

 

This link says you cannot get a CO foreign tax break unless you earned wage/self-employement income while living overseas. I do not know if that is correct.

 

https://www.myexpattaxes.com/do-u-s-expats-need-to-file-colorado-state-taxes

 

this from the CO tax dept talks about a credit for taxes paid to another STATE. You would have to do some research to see how "state" is defined. If broad enough, it might apply. 

 

https://www.colorado.gov/pacific/sites/default/files/Income17.pdf

 

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