US Government Obligations for state tax (AZ)

[jowilb]

In Arizona the percent of Government Obligations in a mutual (bond) fund is exempt from state tax.

For an individual bond fund should long-term and short-term capital gain be deducted from Total Dividends and Distributions before multiplying Total Dividends and Distributions by the percent that is Government Obligations?

[DavidD66]

No.  Just report the amount of your box 1 dividends multiplied by the % of government obligations.  Short-term capital gains in a mutual fund are reported to shareholders   on Form 1099-DIV (Box 1a) as ordinary dividends, not capital gains. Long-term capital gains are reported as Capital Gain Distributions.  Supplemental information for mutual funds that provide the percentage of income from government obligations typically report that amount separately for dividends and distributions (if applicable).  

[jowilb]

How should percent of Government Obligations be determined from information on a 1099-DIV if there are multiple funds in the Vanguard brokerage account?

Though percentages of GO are given on back pages for each fund, the information in Box 1 is not broken down per each fund. 

Information about capital gains and long and short term dividends are given for each fund though.

Is simply subtracting capital gains from the total dividends and distributions the key before multiplying that by the percent for each?

[DavidD66]

For the information listed for each fund, the capital gains should be Long Term Capital Gains reported in box 2a and wouldn't factor into any calculation. I would simply take the percentage of GO for each fund multiply it by the amount of ordinary dividends paid out by that fund. It is my understanding that that is what the percentage represents.  That's the way I've been doing it for years.  

[jowilb]

Thank you. I knew how to do the percentage math. The problem is that each fund in the brokerage account doesn't have individual boxes with values.  It does list many breakdowns of  interest and dividends. What I've done is simply subtract long term cap gains from total dividends as the amount to figure percentages on and hope that's correct. Thanks again.